Nothing says " love you" like a prenuptial agreement, right? Maybe not. While a valuable legal agreement can protect your savings account and investments, some people actually view the prenup as a dealbreaker; the desire for one can be interpreted as lack of trust on the part of whomever requests it. So it can be pretty difficult to convince a potential spouse that having a prenup is a good idea when they have this attitude.
On the other hand, many couples consider signing a prenup to be just as important in preparing for marriage as reserving the church and registering for gifts. But what if you and your spouse opted not to create a financial contract before marrying and now you regret it? A postnup may be the answer.
The Difference Between a Prenup and Postnup
Postnuptial agreements, sometimes referred to as post-marital contracts, are far less common than prenups, but have been gaining in popularity over the last several years. In essence, these two contracts are the same thing, but a postnuptial agreement is created after a couple has entered into marriage rather than before.
The purpose of a postnup is to protect individual assets and income in the event the marriage ends or a spouse dies. They’re especially popular in common law property states where marriage automatically entitles one spouse to the other’s assets. However, it’s important to know that each state has it’s own laws and requirements surrounding postnuptial agreements.
Who Needs a Postnuptial Agreement?
It’s important to understand signing a postnup doesn’t mean you expect your marriage to end in divorce. They certainly aren’t for everyone, but a postnup can do a great deal of good for marriages under special circumstances:
Changes to Prenup: Most couples who do decide to create a postnuptial agreement already have a prenup. A postnup is usually needed when a significant shift in finances occurs, like a spouse’s promotion or inheritance, and it becomes necessary to change the terms of the original contract. In fact, there can be multiple revisions to a postnup as the financial situation within a marriage changes.
Protecting a Business: Many business owners and private equity investors create postnups because a split in the marriage could pose a serious threat to assets belonging to the business itself or outside partners and investors.
Fighting About Finance: Anyone who is married knows money can be a great source of strain on the relationship, though it is much more so for some than others. Sometimes married couples who argue over finances often and are in danger of divorcing over the subject find a postnup relieves that stress and strengthens the union once again.
Adultery: Postnups are also common tools for wrangling a philandering spouse. In marriages where a spouse has cheated, the other may stipulate in a postnuptial agreement that if it happens again, the cheater must pay a significant sum of money to their husband or wife. Of course, whether this actually improves the marriage is certainly questionable.
Creating a Postnup
If you think you and your spouse need a postnuptial agreement, understand it’s not as easy as writing up who-gets-what if you divorce and having a lawyer sign off on it. Most post-marital contracts, regardless of the state, require that both parties have individual legal representation, submit to full disclosure of your financial situation (i.e., no secret bank accounts) and create a contract that’s fair to everyone involved.
However, people who are in any of the above scenarios can benefit greatly from a postnuptial agreement and it may be worth creating one. Sometimes it’s a business requirement, and sometimes it can actually save your marriage. So if you believe a postnuptial agreement is a good idea, all you have to do is convince your spouse it is, too.