While many people may be aware of prenuptial agreements, many may not realize that there is such a thing as a postnuptial agreement. If you’re already married and did not sign a prenuptial agreement, you may discover that a postnuptial agreement can be in your best interest.
What is a Postnuptial Agreement?
A postnuptial agreement is a legal document for people who’ve already gotten married or in a civil union. Just like a prenuptial agreement, a postnuptial agreement sets rules as to how the couple’s assets will be divided if they should get divorced or legally separated. It also states how much spousal support one party may owe the other if the marriage ends.
Is a Postnuptial Agreement better than a Prenuptial Agreement?
The answer to that question depends on who you ask. Talking about money and the “what ifs” of divorce can be uncomfortable, especially if you’re in the middle of planning a wedding. That’s why some people wait until after the wedding to discuss it.
But, other people prefer a prenuptial agreement because if they don’t like the parameters of the document or can’t come to an agreement, they can walk away much easier than if they were already married.
The big thing to remember with a postnuptial agreement is that you’re already legally bound to your spouse and owe a fiduciary duty to one another. Each spouse must disclose all of their assets and debts. While this may make some people uncomfortable, it is something to take into consideration.
What Types of Things does a Postnuptial Agreement Include?
The types of things included in these agreements are similar to those found in a prenuptial agreement. They include:
- How property & other assets will be divided if the marriage ends
- Whether one spouse will pay spousal support and under what terms and amount
- What marital debts will be split evenly
- How assets will pass if one spouse dies while married
Postnuptial agreements can also detail custody and support of children in the event of divorce. But, state law can also restrict provisions in this area if they are included.
What are the Basic Requirements of a Postnuptial Agreement?
In order for a postnuptial agreement to be valid, it must meet the following requirements:
It must be in writing. No oral agreements are acceptable. Having the agreement in writing ensures both parties are on the same page.
It must be voluntary. Both parties must have signed it on their own free will, if there is an indication that it was signed under a threat, the agreement is void.
There must be full disclosure. Each party must fully disclose all assets, income, and debt. If one party does not give accurate information, the agreement can’t be enforced.
The agreement must be fair. It cannot be biased to one spouse.
All of these requirements must be in order so that a postnuptial agreement is valid.
Are There Different Types of Postnuptial Agreements?
Postnuptial agreements are generally broken down into three different types.
To Divide Assets & Decide on Spousal Support
This is the most common type of postnuptial agreement. This will legally state how the couple’s assets should be divided if they get divorced. It will also lay out the rules for alimony or spousal support.
To Decide How Assets Would be Divided if One Spouse Dies
A postnuptial agreement can also detail the division of assets if one spouse dies during the marriage. This type of document typically overrides a will or any state laws that give spouses certain property rights. When a couple signs this agreement they typically waive any rights that would allow them to inherit property or other assets.
A Template to Use as a Separation Agreement
This document will give details about child custody, child and spousal support in the event of a divorce. This type of agreement can be rolled into a divorce decree, saving time and money down the road.
Why Would I Want a Postnuptial Agreement?
Signing a postnuptial agreement is a personal decision. Some people do it to clearly define their wishes for whatever property they have. Other people may have children from previous relationships and want to make sure they get certain assets no matter what happens in their marriage.
For others, a postnuptial agreement may protect them from a spouse who is financially irresponsible or who has had legal trouble. If one spouse inherits a large amount of money during the marriage they may also look for a postnuptial agreement to protect their newly found wealth.
A postnuptial agreement may also protect spouses who stop working to stay home and take care of children. It will ensure they are financially taken care of should there by a divorce.
When is it Not a Good Idea to Have a Postnuptial Agreement?
You may want to rethink a postnuptial agreement if there is a large difference in income between you and your spouse. If you are the spouse earning more, you may lose in the end. It is also not a good idea to sign any agreement if you haven’t had time to read it thoroughly. You want to understand everything you are signing and agree with it.
Do You Want More Information on Postnuptial Agreements?
If you’re looking for more information on postnuptial agreements, contact Illaraza Law. At Illaraza Law, we can advise you about postnuptial agreements and the best way to go about them so that you are protected.