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The short answer to the question “What’s the difference between a prenuptial and a postnuptial agreement” is simple: one is executed by spouses before their marriage, and one is executed afterward. While that answer is technically accurate, it’s not entirely complete. Let’s take a closer look at the question of postnuptial agreement vs. prenuptial agreement.
Postnuptial agreements and prenuptial agreements are contracts between spouses (or future spouses, in the case of a prenup). Typically, they deal with financial issues between the couple, such as alimony, what property will be considered marital for purposes of equitable distribution in a divorce, and what a spouse will and won’t inherit in the event of the other spouse’s death.
These agreements can also deal with issues like the division of labor during the marriage or other non-financial issues. One thing a prenup or postnup should not try to address is the custody of children or future children, since that should be decided based on the best interests of the children themselves at the future time of separation or divorce. If a couple does include terms regarding their children in a prenup or postnup, a court would probably find those terms unenforceable.
Sometimes the only difference between a prenuptial agreement and a postnuptial agreement is that the couple ran out of time to execute a prenup before the wedding, but they still want to have the agreement.
Although many people think of these agreements as meaning that the couple is contemplating a divorce, in reality, they can strengthen a marriage. The process of discussing and negotiating the agreement ensures the couple is on the same page about important issues and lays a foundation for good future communication.
As noted above, sometimes the reason that people get a postnup is simply a matter of timing. But sometimes, circumstances arise after a marriage that makes an agreement a good idea.
When a couple gets married, they might both have flourishing careers that they both intend to continue. However, after they have one or more children, they might later decide that it would be better for their family for one parent to stay home. Of course, taking oneself out of the workplace for years can seriously damage one’s earning capacity and career prospects. In order to ensure that one spouse doesn’t suffer financially because they sacrificed their career for the family, the couple might execute a postnup to protect the stay-at-home spouse in the event of divorce.
Let’s face it: sometimes a spouse commits adultery or other marital misconduct. When the other spouse finds out about it, it could lead to the breakdown of the marriage. Following marital difficulties, a postnup can provide an incentive for a wronged spouse to stay in the marriage and try to work things out and for the other spouse to behave better.
As a general rule, property inherited by one spouse is considered separate property not subject to division in the event of a divorce, but inherited property can be commingled with marital property, creating confusion about whether it’s subject to division. A spouse who receives an inheritance, especially a large or unexpected one, might ask the other spouse to agree in a postnuptial agreement that the property will belong only to the spouse who inherited it even if used for marital purposes or mixed with marital funds.
If a spouse starts a business during the marriage, including a business with one or more partners outside the marriage, they may want a postnup to clarify the treatment of the business interest in the event of divorce, including how it will be valued. Similarly, if a spouse has a business from before the marriage that suddenly grows, they may want a postnup for the same reasons.
If one spouse incurred significant debt during the marriage without the consent of the other spouse, the couple could execute a postnuptial agreement specifying that the debt will be the sole responsibility of the spouse who incurred it. A couple might also execute a postnup if one spouse had significant debt before the marriage that they did not disclose to the other spouse until afterward.
These are just a few of the many reasons a couple might decide to create a postnuptial agreement. The bottom line is that life is unpredictable, and if an unforeseen circumstance arises, a postnuptial agreement can help you and your spouse to course-correct in light of your new reality.
If you are considering getting a prenuptial agreement, but thinking you might just put it off and get a postnup instead, there are a couple of reasons you may want to reconsider. Both prenups and postnups can be difficult to enforce, but it may be even more challenging to enforce a postnuptial agreement. Like any contract, both parties must give the other something of value (called “consideration”) for the agreement to be binding. With a prenup, the promise to enter into the marriage is the consideration. With a postnuptial agreement, the couple is already married, so there must be some other form of consideration.
Another potential issue with the enforceability of a postnup is that one spouse may feel pressured by the other to sign the agreement, making it not entirely voluntary. A related issue is that one spouse asking the other to sign a postnuptial agreement could be seen as a sign that the marriage is already in trouble, leading to a downward spiral. Also, different technical requirements apply to postnups from prenups. And of course, once married, the incentive to give up some rights changes.
Whether you choose to get a postnuptial agreement or a prenuptial agreement, it’s important to work with an experienced family law attorney who understands these agreements and how to avoid potential problems with enforceability
To learn more about the difference between a postnuptial agreement vs. prenuptial agreement, contact Strickler, Platnick & Hatfield to schedule a consultation.
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