You’ve heard of a Prenup, but have you heard of a Postnuptial Agreement?

Prenuptial agreements are typically signed under hopeful and joyful times during the engagement period for couples. Many are unaware that there is also a postnuptial agreement that can be entered into after marriage. The circumstances are usually far less rosy as a prenup, but they can lead to successful scenarios for a couple.

What is a postnuptial agreement?

A postnuptial agreement is a written agreement that is executed after a couple is married. These agreements are entered into to settle the couple’s affairs and assets in the event of a separation or divorce. Postnuptial agreements may include provisions related to the division of property and assets after a relationship is terminated, parameters for spousal support, division of debt and additional what happens to an individual’s assets after a death. The purpose of a postnuptial agreement is like that of a prenuptial agreement in that it is focused on protecting each individual and their assets. The only difference really is the time in which the agreement is reached.

How do we know if we need a postnuptial agreement?

Not everyone needs a postnuptial agreement, honestly many do not know they even exist. There are a few circumstances that would direct you to consider a postnuptial. If one, or both parties involved, are wealthy. If you enter a marriage with significant pre-marital assets or expect to inherit significant assets, a postnuptial agreement could help ensure that if you do exit your union you will maintain what you brought into the marriage financially. Another reason to look at a postnuptial agreement is if you have children from a previous marriage. Having an agreement in place maintains your wishes for your inheritance with your children preventing any uncertainty. If you, or your spouse, own a business it might make sense to look at a postnuptial agreement as well. Many couples opt for a postnup to avoid any awkward conversations before marriage and wait until they are settled into married life. And finally, if you unexpectedly receive a large inheritance from a family member you may want to consider a postnup.

While conversations around assets and finances can be awkward for couples it is important to have a plan in place and for the details to be sorted. Life throws curveballs every day it’s better to be prepared than left wondering.