Family

Marriage contracts: safeguard your future

A marriage contract is more a practical than a romantic matter. We explain what exactly it can do and why it can make sense.

05 Jul 2024 6 min read

A marriage contract allows you to change the standard matrimonial regime of “community of acquired property” or to choose “joint marital property” or “separation of property” instead.

The words “marriage contract” put many people in mind of divorce and how a contract can prevent conflict should a couple decide to go their separate ways. But this is deceptive: Although a marriage contract can stipulate certain arrangements in the event of divorce, it is of more relevance when one spouse dies.

This article explains when a marriage contract is worthwhile and what exactly it stipulates.

Division of assets by law: the scenarios

Unless a couple agreed otherwise either before or after getting married, marital property is deemed to be held jointly (“community of acquired property”). Specifically this means that in a marriage there are two types of asset – personal property and acquired property:

Personal property: personal property includes the assets that each partner brought into the marriage and those objects that are solely for personal use, e.g., clothes. Personal property also includes gifts and inheritances received during the marriage.
Acquired property: acquisitions include assets obtained jointly during the marriage. These can include income from personal assets (e.g., dividends), retirement savings, social insurance benefits, salaries and in principle everything that is not personal property.

When a marriage ends, the matrimonial property regime of “community of acquired property” means the following:

In the event of divorce: jointly acquired assets are split 50/50 between both parties. Personal property is not divided up.
In the event of death: the surviving partner receives half of the acquired property. The deceased’s personal property and the other half of the acquired property become part of their estate, of which the surviving spouse and the heirs are entitled to half each.

Does the standard property regime suit your needs and life situation?

Depending on the needs and circumstances of a married couple, the standard regime of “community of acquired property” is not always the best solution. Other options may be preferable, especially when valuable assets are at stake, such as real estate or shares in a business.

For example, if during your marriage you set up a company using your own money, the law views the business as acquired, i.e., joint property. In the event of divorce, large compensation payments may be necessary because the business and any income generated from it make up a significant percentage of jointly acquired property.

If one spouse dies, the marriage contract takes precedence over other inheritance arrangements. This means that the surviving spouse is entitled to half the acquired property, with the other half being inherited by others. Not only may shares in the business not be passed to the right person, but high compensation payments may also have to be made to other beneficiaries of the deceased’s will.

Similar situations can also arise in the case of other valuable assets, such as jointly held property. You can learn more about this topic in the following article: “Separation or divorce – and your home?”.

Stipulations within the “community of acquired property”

With a marriage contract, you can make changes within the community of acquired property or choose a different property regime. The former is what usually happens.

For example, you can declare that certain assets are personal property or that income from your own assets should not be classed as joint property. This can be very useful for women entrepreneurs. It enables them to declare company shares as personal property and to exclude income received from it from being classed as joint property.

A marriage contract can also stipulate that all acquired property passes to the surviving spouse in the event of death. This can ensure, for example, that the surviving spouse holds onto the jointly acquired property and that no compensation payments to the heirs are required. However, this is only possible if the couple is either childless or their children are their biological offspring.

Modifying the matrimonial property regime in the marriage contract: the options

You can also change the matrimonial property regime in the marriage contract. In Switzerland the following alternatives are possible:

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Joint marital property

There are three types of such property: each spouse’s personal property, and joint property. The latter includes the income and assets of both partners, which is split between them if they divorce. A marriage contract defines what is owned individually and what is owned jointly. It can also stipulate that, when one spouse dies, all of their property goes to the surviving spouse. This depends on whether the couple’s children (if any) consent to relinquishing their statutory share of the inheritance, in which case a separate inheritance contract with the children is required.

Separation of property

As the name suggests, under this regime each person retains their own assets. It does not matter whether the assets were acquired before or after the couple got married. Under the separation of property scheme, assets are not divided up in the event of divorce. If one spouse dies, their assets become part of their estate. Separation of property can make sense, for example, in the case of excess debt or in order to secure the assets of one spouse.

What a marriage contract can only partially determine: the consequences of divorce

The marriage contract determines the matrimonial regime or, in other words, lays down certain stipulations within it. While marriage contracts in Switzerland can contain stipulations on maintenance payments and pension compensation in the event of divorce, they are controversial and not necessarily binding.

What you need to consider before signing a marriage contract

In Switzerland you can sign a marriage contract either before you marry or during the marriage. It does not matter how long you have already been married for. Changes to the contract are also possible. The following conditions apply both when concluding the agreement and for any changes you may make:

The document must be publicly authenticated by a notary.
Both spouses must consent.

Linking a marriage contract with inheritance stipulations

A marriage contract primarily determines property matters, though it can also have an impact in the event of death. Nevertheless it can be worth looking into inheritance arrangements, to ensure that everything is organized according to your wishes. You can stipulate in a will or inheritance contract what should happen after your death. Read about the options open to you in our article “Transmission of assets: make plans early on”.

We will be very happy to advise you in person and to answer your questions about marriage contracts and inheritance planning.