Many people are familiar with the concept of a prenuptial agreement. But you may not be aware of postnuptial agreements. As the name implies, this legal contract is created and agreed to after entering a marriage.
Even if you feel certain about your relationship now, nobody knows what the future holds. Having a plan in place in case divorce comes into play may provide a sense of reassurance. Even better, creating a postnup may strengthen your relationship.
Below we discuss postnups in detail, including what they can cover, their benefits, how to create one on your own and when it might be appropriate to have an attorney step in to assist.
What is a postnuptial agreement?
A postnuptial agreement, sometimes referred to as a postnup or post-marital agreement, is a legal contract between two spouses outlining what will happen in the event of a divorce. As the name implies, a postnuptial agreement is entered into after the marriage has been finalized.
Topics that might be covered in a postnuptial agreement
A postnuptial agreement can cover a broad range of topics, including but not limited to:
- The division of marital property, assets and liabilities in the event of a divorce
- The division of separate property acquired prior to the marriage or by a specific spouse during the marriage
- The terms and conditions of any spousal maintenance or support
- The division of ownership and control of any business interests
- How to handle inheritances and estate planning matters
Importantly, a postnuptial agreement typically can’t bind the parties to any agreement concerning child custody or child support. The permitted topics depend on the jurisdiction in which you reside. An experienced family law attorney can help you decide whether and how best to proceed with a postnup.
Benefits of a postnuptial agreement
There are a number of benefits for couples who choose to enter into a postnuptial agreement. Below are some examples.
Provides a clear path forward
Going through a divorce is often a time of uncertainty and emotional turmoil. Having a valid postnup may provide the parties with valuable clarity and clear guidelines regarding their respective rights and responsibilities moving forward. This may lead to greater peace of mind.
Encourages open communication between the parties
Many couples feel uncomfortable discussing financial, property and other related matters. However, these are important topics for individuals who intend to spend their lives together.
The process of creating a postnuptial agreement may provide an avenue for couples to discuss these issues in a relatively low-stress environment. In turn, this may improve communication between the parties and strengthen their relationship.
May avoid costly and lengthy litigation
Perhaps one of the most important benefits of having a postnup is the ability to potentially reduce the timeframe and cost associated with litigating a divorce.
Things such as property division, spousal support and responsibility for any outstanding debts will likely need to be determined in a divorce proceeding. By establishing clear guidelines for these issues in your postnup, the proceedings may be simplified and shortened. And less time spent on a divorce generally means you’ll spend less money.
Prenup vs postnup: What’s the difference?
Although they’re similar, the primary difference between a prenuptial agreement and a postnuptial agreement is the timing:
- A prenup is an agreement a couple signs before getting married.
- A postnup is one they sign after they’re married.
There are other differences. For example, postnuptial agreements are typically viewed less favorably by courts than prenuptial agreements. Some legal experts believe there’s more potential for one spouse to coerce the other into consenting to terms they don’t actually understand or agree with, or for spouses to blindly sign a postnup. This can make postnuptial agreements more difficult to enforce than prenups.
Additionally, because a postnuptial agreement is entered into after a marriage ceremony, the commingling of assets that were previously considered separate property can sometimes make it harder to identify the property you want to protect with your postnup.
How to create a postnuptial agreement
Every marriage is unique, so there’s no one way to create a postnuptial agreement. That said, couples tend to take some version of the following steps:
- Gather all financial information for both you and your spouse, including information about your assets, debts, investments, income and any other relevant details.
- Exchange, disclose and discuss all identified financial information with your spouse.
- Have an open, transparent and comprehensive discussion with your spouse regarding all provisions that you may want included in the agreement, such as matters related to property division, spousal support, inheritance rights and debt allocations in the event of a divorce.
- Negotiate any disputed terms until you agree about what the postnup should entail.
- Prepare an initial draft of the postnuptial agreement detailing all terms and provisions agreed upon between you and your spouse.
- Review the draft and make revisions where necessary to clearly and accurately reflect both of your intentions.
- Once both parties are satisfied with the agreement’s terms, finalize and sign the postnup in accordance with the requirements of your particular jurisdiction.
- Store the original agreement and your signed copies in a safe location in the event they’re needed in the future.
What makes a postnuptial agreement valid?
Generally, a postnup must meet the following criteria to be valid and enforceable:
- The agreement must be in writing.
- Both parties must voluntarily agree to all the terms.
- There must be a full disclosure of all relevant information regarding the parties’ financial information prior to the execution of the agreement.
- The terms must be fair and reasonable and not so overly one-sided as to be considered unconscionable.
- Both parties must sign the agreement.
The precise requirements vary from state to state, so check the rules in your jurisdiction or consult with an attorney in your state to ensure your agreement complies with all applicable rules.
Pros and cons of writing a postnup without a lawyer
Couples can create a postnuptial agreement without the assistance of a lawyer. Before doing so, though, consider the advantages and disadvantages of this.
Benefits of writing a postnuptial agreement without a lawyer
- Cost savings since you don’t need to pay a lawyer
- Greater privacy since you don’t involve any third parties in any discussions
- Increased flexibility and control over the provisions you wish to include in your agreement
Drawbacks of writing a postnuptial agreement without a lawyer
- Lack of legal expertise on the subject matter
- Greater risk of an incomplete, inaccurate or unenforceable postnup, especially when using a postnuptial agreement template found online
- Potential for unequal representation and bargaining power if one spouse hires legal counsel and the other chooses not to
- Increased risk of disputes and emotional challenges between the parties, since there’s no third party who may be able to help manage expectations and guide the parties through the process
If you choose to prepare a postnuptial agreement without the assistance of a lawyer, research the rules and requirements in your jurisdiction. Additionally, take your time to carefully draft the agreement and avoid ambiguities or unclear terms.
When to speak with an attorney
Even if you feel that your situation is relatively straightforward, working with an experienced family law attorney to create your postnuptial agreement may be beneficial. A lawyer may be especially helpful when there are significant assets, complex financial arrangements, potential tax implications or other complicating factors involved. These things may make it hard for you to understand the potential consequences of your agreement.
An attorney can advise you and help make sure you don’t give up important rights. They can also ensure that your postnup complies with applicable laws and protects the rights and interests of you and your family.
Sofie is a writer. She lives in Brooklyn.
