Most people have heard of a prenuptial agreement, but postnuptial agreements are less well-known. Postnups address many of the same issues as prenups. They both allow couples to determine how they will deal with financial issues during marriage and in the event of divorce or the death of a spouse. Whether you need a postnuptial agreement depends on your circumstances and goals. However, if you are asking yourself this question, you should consult an attorney for more information and advice.
What Is the Difference Between a Prenuptial Agreement and a Postnuptial Agreement?
The key difference between the two types of agreements is when they are signed. A prenup is signed before marriage and a postnup afterward. However, that timing difference means that the couple often has very different goals and circumstances that must be addressed in the agreement.
Before marriage, couples typically have separate assets with few or no joint assets. Over the course of the marriage, they will typically accumulate marital property as well as intertwine their finances. The couple’s relationship also may change over time. Spouses seeking a postnuptial agreement are sometimes experiencing a conflict that they hope to resolve with the agreement.
Can You Sign a Postnuptial Agreement at Any Time?
There is no time limit for a postnuptial agreement. It can be signed the day after you marry or 30 years later.
Can a Postnuptial Agreement Substitute for a Separation Agreement?
Many couples use postnups as a way to regulate their marriage when they no longer want to live together but are not ready to divorce because of personal, religious, or financial reasons. If neither spouse wants to marry someone else, they may not feel the need to divorce. However, they recognize that it is important to establish how they will handle financial matters, such as paying expenses, owning and maintaining property, and other issues.
What Terms Should Be in a Postnuptial Agreement?
Most agreements set forth what happens to property in the event the couple divorces or one spouse dies. Typically, they will state what assets and debts are considered separate vs marital property and how those assets and debts are to be divided in the event of divorce.
The postnup may also establish rights to use property and responsibilities for maintaining it during the marriage. For example, if the couple is living apart, one spouse may have the sole right to stay in the marital home but the other spouse will not waive rights to the home in the event of a divorce. Either spouse may be required to pay the expenses for the house.
When Is a Postnuptial Agreement Enforceable?
Both prenups and postnups have the same requirements as follows:
- Full disclosure. The parties must fully disclose their assets, income, and liabilities.
- Fair terms. The agreement must be fair but can be more favorable to one party over the other depending on the circumstances.
- Assistance of counsel. The parties must have time to consult an attorney for advice regarding the agreement. Note that if there is a substantial imbalance in power between the spouses, it is best for each side to have their own attorney and ample time to review and understand the terms.
How Can an Attorney Help with a Postnuptial Agreement?
Postnups can be complicated because the parties often have accumulated assets, have children, and want to establish rules to govern their marriage as well as a future divorce or death of a spouse. An attorney can help you evaluate your options and draft appropriate documents to protect your rights. In addition, an attorney can help to ensure that your estate planning documents are consistent with any prenuptial and postnuptial agreements.
Our attorneys frequently counsel clients and their matrimonial attorneys regarding postnuptial agreements, trusts, and other estate planning devices to preserve assets during marriage and after it ends. Contact us today to learn how we can assist you.