Something unprecedented is happening in Canadian households right now. Baby Boomers are beginning to pass down the largest inter generational transfer of wealth in history — an estimated $80 trillion or more across North America. For millennials and Gen Z, that means inheritances, family properties, investment portfolios, and business interests are landing in their laps at exactly the age when they’re also getting married.
And here’s the part nobody talks about at the dinner table: without a marriage contract, that inheritance may not stay yours.
This isn’t a scare tactic. It’s a legal reality that catches thousands of Canadian families off guard every year. Understanding how inheritance interacts with family law is one of the most important financial conversations you can have before walking down the aisle.
How Inheritance Works in Ontario (Without a Prenup)
Under Ontario’s Family Law Act, assets you bring into a marriage — including inheritances received before the marriage — are not fully excluded from equalization. You receive a deduction for their value at the date of marriage, but any growth during the marriage is shared. Inheritances received during the marriage, however, are generally excluded.
That sounds protective, right? Not so fast. The moment you commingle an inheritance with marital assets — say, depositing it into a joint bank account, using it to renovate the kitchen, or putting it toward the down payment on a home — it can lose its excluded status. The legal concept is “tracing,” and proving where that money went years later can be difficult and expensive.
The matrimonial home is a particularly sharp trap. Regardless of who paid for it, both spouses have equal rights to the home. If inherited funds are used toward its purchase or improvement, that contribution can lose its exclusion and be brought into the equalization calculation. The result is that a significant portion of what was intended to stay in the family may end up being shared.
A marriage contract allows you to clearly protect inherited assets, even if they are used toward shared expenses or property. Without one, you are relying on default rules that may not reflect your intentions.
For a deeper look at how Ontario’s default rules work, read What Happens if You Don’t Have a Prenup in Ontario.
Why Parents Are Asking Their Kids to Get Prenups
This isn’t just a couple’s decision anymore. Increasingly, it’s parents and grandparents who are raising the prenup conversation — not because they dislike their child’s partner, but because they want decades of hard work to stay in the family.
Think about it from a parent’s perspective: you’ve spent 30 years building equity in a cottage, a rental property, or a family business. You want your child to benefit from that. But without a marriage contract, a divorce could force a sale or a payout to someone who was never intended to receive it.
Estate lawyers across Canada are now routinely advising clients to make prenups a condition of inheritance planning. Some families even include prenup requirements in trust documents. It’s not about distrust — it’s about protecting the family’s financial architecture for the next generation and beyond.
A 2025 TD Bank survey found that 52% of Gen Z Canadians would want their partner to sign a prenup, well above the national average. Much of that shift is driven by conversations happening at family dinner tables, where parents are saying: “We support your marriage, and we also want to protect what we’ve built.”
What a Marriage Contract Can Protect
A well-drafted marriage contract in Ontario can protect inherited assets in several practical ways:
It can specify that inherited property remains separate, even if its value grows substantially during the marriage. It can ensure that family gifts, trusts, and heirlooms are excluded from equalization. It can address the matrimonial home directly — an area where Ontario’s default rules are surprisingly aggressive. It can outline what happens to income or gains generated by inherited investments. And it can protect family cottages, vacation properties, and rental portfolios from being divided in a separation.
The key is specificity. A vague clause that says “inheritances are mine” may not hold up. A detailed contract that references specific assets, outlines how they’ll be managed, and includes full financial disclosure from both sides is far more likely to be enforced. For more on how prenups protect family assets, read How Prenups Protect Family Businesses, Cottages, and Generational Wealth.
The Conversation Starter
If you’re expecting an inheritance — or you’ve already received one — bring it up with your partner as a planning conversation, not a confrontation. Frame it as: “This is about protecting our family’s history, not about protecting myself from you.” For practical tips on initiating this discussion, see How to Bring Up a Prenup Without Killing the Romance.
Better yet, have the conversation together with a platform like I Do Prenup, where both partners can work through the details collaboratively, privately, and at their own pace. The process is designed to reduce tension and encourage honest dialogue — exactly the kind of dynamic that makes difficult financial conversations productive rather than adversarial.
The great wealth transfer is happening whether we’re ready or not. The only question is whether you’ll protect what’s being passed down — or leave it to a system of default rules that doesn’t know your family’s story.
Ready to protect your family’s legacy? Start your marriage contract today.
Frequently Asked Questions
Q: Can my parents require me to get a prenup before receiving an inheritance?
Yes. Parents can include prenup requirements in trust documents or estate plans. While they can’t force you to sign one, they can make it a condition of receiving certain assets or distributions.
Q: What if my inheritance arrives after we’re already married?
You can create a postnuptial agreement (also called a marriage contract in Ontario) at any time during your marriage. Learn more in How to Update or Amend Your Prenup After Major Life Changes.
Q: How much does it cost to protect an inheritance with a prenup?
Traditional lawyers charge $1,500–$10,000 in Ontario. Online platforms like I Do Prenup offer the same legal protection for a fraction of that cost, making it accessible to couples at every income level.