A postnuptial agreement, also known as a postnup, is a legal contract that is created after a couple has entered into marriage. It resembles a prenuptial agreement, with the distinction that a prenup is executed prior to the marriage of a couple. Much like a prenuptial agreement, a postnup addresses financial matters and helps provide for a fair distribution of assets in the event of a divorce.
Postnuptial agreements allow couples time to enjoy their wedding and come to a fair agreement later. They are not just for newlyweds, though. The nature of a postnup also makes them a good choice for people who have been married for years and whose finances have changed since they said their vows.
Reasons to sign a postnup
Postnups are designed to ensure fairness and minimize conflicts during divorce proceedings. Some reasons to consider having a postnup include the following:
- You’ve inherited a large sum of money or property: A postnup can protect inherited assets from potential division in a divorced marriage, as they are typically considered joint property without such an agreement.
- You own a business: A postnup safeguards a business’s assets and income. In the absence of one, the spouse who is not an owner might claim a portion of the business or earnings during a divorce.
- You or your spouse bring considerable wealth to the marriage: Signing a postnup can help ensure equitable treatment and avoid the division of wealth that might otherwise be classified as marital property.
- You, your spouse or both of you have children from your previous relationship: A postnup addresses how assets will be distributed in blended families, making certain that children from prior marriages receive the inheritance that was intended for them.
Postnups offer benefits for couples for a number of reasons. When you are ready to draw up a postnuptial agreement, seek legal guidance to help you navigate the process.