Should everyone have a prenup?

This post comes from Stacy Johnson at partner site Money Talks News.

When you hear the word "prenup," what comes to mind? If you're like most people, you probably picture an old rich guy about to marry a young, not-so-rich gal.

While that's one traditional use for a prenuptial agreement, there are some personal-finance pundits -- notably, Suze Orman -- who  insist that prenuptial agreements are something virtually everyone considering marriage should have. In fact, in articles like this one, she says that even those who just want to move in together should consider a "cohabitation agreement."

We'll get more into Orman's logic for universal prenups in a minute. But first, let's get a lawyer's take on the subject. Check out the news video, then meet me on the other side for more.

A prenup is essentially the same thing as the property settlement agreement associated with divorce: a legal document detailing a couple's assets and how they should be divided if the marriage ends. In addition to keeping assets separate, a prenup can also keep debts separate, as well as provide for spousal support and even dictate behavior during the marriage. For example, the bride might say that if the husband gains too much weight, he forfeits money. Or the groom might stipulate that if the wife cheats, she loses.

You'll need a lawyer to do a proper prenup, and as you learned in the video above, they're not cheap: The lawyer I talked to said $1,500 minimum. Not only that, your partner will need the final agreement reviewed by a lawyer, too.

Orman bases her belief that prenups are for everyone on two primary arguments.

The first is the high rate of divorce. In this Yahoo article, for example, she says, "The national divorce rate is roughly 50%." In this article on Oprah.com, she says, "North of 40% of marriages end up in divorce."

But is the common belief that half of marriages end in divorce even true? Not according to some people. From this 2005 article in The New York Times:

The (50 percent) figure is based on a simple -- and flawed -- calculation: the annual marriage rate per 1,000 people compared with the annual divorce rate. In 2003, for example, the most recent year for which data is available, there were 7.5 marriages per 1,000 people and 3.8 divorces, according to the National Center for Health Statistics.

But researchers say that this is misleading because the people who are divorcing in any given year are not the same as those who are marrying, and that the statistic is virtually useless in understanding divorce rates. In fact, they say, studies find that the divorce rate in the United States has never reached one in every two marriages, and new research suggests that, with rates now declining, it probably never will.

Of course, even if Orman is wrong on the percentages, divorce is still common. So let's move on to the second reason she thinks prenups are essential. From the same Oprah article cited above: "Drawing up a prenuptial agreement together is a sign of incredible trust and financial openness -- you're fooling yourself if you think you can achieve complete intimacy without it."

What she presumably means is that if you're going to share your life with someone, it's important to share your financial life as well. I agree. Who wouldn't? But sharing financial intimacies with your partner isn't the same as sharing them with your partner, your lawyer, and your partner's lawyer, then paying thousands of dollars to have them converted into a binding legal agreement.

As you've probably gathered by now, I think Suze Orman's suggestion that every engaged couple should have a prenup is silly. Two engaged people without any money starting their lives together shouldn't create a $2,000 legal bill. And if they eventually split up, they should be OK with equally splitting what they made together. But there are, in fact, lots of people who should explore a prenup:

• People with money, at least if they'd like to leave the relationship with as much as they came in with. It doesn't have to be big money. If I'm marrying someone with $100 million and I come in with $25,000, I still might want to protect my $25,000.
• People who might inherit, at least if they want to make sure family property, heirlooms, or money stays in the family.
• People whose partners have debt, at least if they want to make sure their partner's debt problems will never become theirs.
• People who own a business, at least if they want to make absolutely sure that the business remains entirely theirs no matter what.
• People whose income might radically increase, at least if they don't want to potentially share it with anyone in the form of support after divorce.
• People with children from other marriages, at least if they want to make sure certain assets pass to their kids upon death or divorce rather then their partner.

It's possible to begin the prenup process -- and save some money -- by drafting it yourselves, then taking it to lawyers. Nolo's Prenuptial Agreements: How to Write a Fair & Lasting Contract is one of many books that might help. (You can also learn more about prenups at this page on Nolo's site.)

Bottom line? Prenups aren't nearly as simple as people like Suze Orman suggest, and they're not for everyone. But if you decide  they're for you, remember what the lawyer said in the video above: Be clear on your reasons, start early, and work together.

And as you approach marriage, remember this too: Honest communication is not the main thing in a successful relationship: It's the only thing.

More on Money Talks News and MSN Money:

• Should you say 'I do' to divorce insurance?
• 3 things to know before you live together
• Should you insure your wedding?

• Estimate your credit score for free

• Can your family survive on 1 income?

• Marrying Mr. Debt? Prepare to pay