Did you know postnups are on the rise? In fact, over 51% of family law attorneys surveyed say they’ve seen an increase in the request for postnups. So, if you’re looking for the laws on postnups–look no further; we’ve got everything you need to know about these types of agreements, from what laws apply to specific examples of postnups in real life.
Types of postnups
First things first, postnuptial agreements (a.k.a., postnups) are the type of agreement that a couple can get during their marriage. However, there are several different types of postnups. Here are the three categories of postnups:
- A separation agreement: This type of postnup is essentially an agreement incident to divorce–the couple is for sure getting a divorce in the imminent future and are planning out the terms of their agreement.
- A reconciliation agreement: This type of postnup is for couples who would get a divorce but decide to stay married… ONLY if they sign the postnup agreement (i.e., reconciliation agreement). Some states, such as New Jersey and Indiana, only allow couples to get reconciliation agreements. In other words, if your marriage is going well, you cannot get a postnup there because you aren’t “reconciling.”
- A postnuptial agreement: The most common use of the term “postnup” is a postnuptial agreement where the parties are continuing the marriage, they’re on good terms, but simply outlining their finances, like they would in a prenup.
Important note: A reconciliation agreement and a postnuptial agreement are very similar in terms of what goes into the agreement. The main difference is the intention of the document, the consideration, and the standards a court would apply in analyzing the agreement.
This article only discusses #2 and #3 types of postnups above. That is, a marital agreement in which the parties plan to stay married. A postnuptial agreement that is incident to divorce is typically known as a separation agreement and is not discussed here.
What laws cover postnups
Postnups are dictated by the laws of each state. For example, Nebraska case law specifically states that postnups are against the state’s public policy, so you may NOT get a postnup in Nebraska. (See Devney v. Devney, 295 Neb. 15, 886 N.W.2d 61 (2016)).
Most states have a patchwork of case law and statutes that piece together the law on postnups. In other words, most states do not have one specific piece of legislation stating what the laws are on postnups. Instead, it’s a statute here or there that mentions postnups or a case that authorizes them. However, there are a few states that do have statutes expressly laying out the laws on postnups, such as Minnesota (Minn. Stat. § 519.11) and North Dakota (N.D. Cent. Code § 14-03.2-02).
State law variations
Another thing to keep in mind is that each state may differ in what is required for a postnup. For example, in Minnesota, legal representation is required for a valid and enforceable postnup and is presumed unenforceable if a divorce occurs within two years of the postnup signing. (Minn. Stat. § 519.11). That is not the case in most other states. In fact, most states have very little legislation or case law on postnups at all!
The bottom line is that each state varies in what is required for a valid and enforceable postnup which is why it’s important to research your state laws and consult with an attorney if you do plan on getting a postnup.
Key elements of a postnup
Now that you understand postnups vary by state, what can you expect, generally speaking, for most states as it pertains to the laws around postnups? Well, we’ll tell ya! Here are the key elements of a postnup that are truly in (most) states:
- It must be in writing & signed.
- Some states require notarization and witnesses, but it can be a good idea to get them anyway (it won’t hurt!).
- Providing full financial disclosure to each spouse (sharing all income, assets, debt, and inheritances and their values with one another).
- Must have consideration for the agreement, meaning each party is receiving something in exchange for signing the agreement.
- Must be entered into voluntarily (no duress or coercion).
- Must be entered into knowingly and understandingly (no tricks, fraud, mistake, etc.).
- Some states strictly require legal representation, but having a lawyer is generally advised in all states.
- The agreement must not be unconscionable or against public policy. This means it mustn’t leave one party destitute or in an extremely unfair position and must not break any policies or laws.
If you follow the above rules, you should be in good shape. However, some states have even more specific rules, like including specific language in the document or having a heightened level of financial disclosure.
What can a postnuptial agreement cover?
A postnup can typically cover all of the things a prenup can cover. However, some states place some restrictions on postnup contents. Here’s what you can typically put into a postnup:
- Property classification
- Property division
- Alimony (there are several states that do NOT allow alimony clauses in postnups)
- Elective share waivers (waiving the right to inherit from your spouse when they die)
- Businesses, real estate, investments, you name it
- Joint bank accounts and expenditures
- Pets
- Infidelity
- Confidentiality
- Counseling
- And more
As long as you stay away from child custody and child support matters, as well as any other matters against public policy, you should be in the clear!
Why do people get postnups?
People generally get postnups for several reasons. Here are some of the motivators for getting a postnuptial agreement.
Marital turbulence
As we stated earlier, some people get a postnup as a form of reconciliation. In other words, if the agreement is not signed, they will file for divorce. If the agreement is signed, they will remain married. For example, maybe one spouse committed adultery, and the other spouse wants to protect themselves with a postnup in case it happens again, and they refuse to stay married unless the agreement is signed.
Change in finances
Let’s say you got married 10 years ago. A LOT has changed in that time. Perhaps you’ve grown a business and sold it–making a pretty penny. Maybe Great Aunt Mary left you a small fortune when she passed. Whatever the case may be, you want to ensure that the assets you’ve amassed are protected.
Change in lifestyle
Perhaps when you got married, you both were software engineers working away in Big Tech. Fast forward to now. One of you is a stay-at-home parent to five kids, and you moved to a farm in Wyoming. This may leave the stay-at-home parent financially vulnerable if there is a split.
Change to a prenup or confirm a prenup
If you already have a prenup in place and things change, you may want to amend the terms to the prenup. Alternatively, if the prenup still stands and you just want to reaffirm the prenup, you can do so with a postnup.
You missed the window to get a prenup
Perhaps you ran out of time before the wedding to get a prenup but you still want to get your financials sorted out with your partner. This may be a good way to use a postnup.
You simply want to clarify finances
Maybe you read an article or saw a TikTok about postnups and think it’s a really smart idea to sort out your finances with a postnup (good on you!). If that’s the case, a postnup may be a great way to do so!
Do you need a lawyer for a postnup?
It’s highly advisable to have a lawyer advise you on your postnuptial agreement, regardless of what state you are in. Some states do have a hard requirement for legal representation. Either way, having a lawyer ensures your agreement is legally sound, customized to you, and fair. Given the legal landscape of postnups, having a lawyer helps to create a layer of protection for your agreement in the event one spouse challenges its validity one day.
Postnuptial agreement case law
Let’s take a deep dive into some case law discussing real couples’ postnups in various states and how a court analyzes these agreements “in the wild.”
California case upholding a postnup despite uneven share of assets
A California couple, married for over two decades, decided to reconcile after an initial divorce filing in the late 1990s. They entered into a postnuptial agreement to provide financial security for the wife and investment freedom for the husband. The husband subsequently acquired substantial wealth through business mergers, one shortly before and the other shortly after the agreement was signed.
Years later, the wife filed for divorce again, claiming the agreement was unenforceable due to inadequate financial disclosure. However, the court upheld the postnuptial agreement, citing several key factors:
- No coercion: The husband did not pressure the wife to sign.
- Full disclosure: The husband provided extensive financial information to the wife’s legal and financial team.
- Awareness of assets: The wife knew about the first merger and the potential value of the second.
- Acceptance of benefits: The wife benefited from the agreement for years before contesting it.
- Mutual benefits and representation: Both parties gained advantages, were represented by counsel, and acknowledged the fairness of the agreement.
Bottom line? This case demonstrates that California courts will generally enforce postnuptial agreements if they are entered into voluntarily, with full knowledge of financial circumstances, and provide mutually agreed-upon benefits, even if one spouse benefits more than the other from the agreement.
(In re Marriage of Burkle, 139 Cal.App.4th 712 (2006))
Texas case upholding a postnup even though wife claims she didn’t understand it
In a Texas case involving a postnup agreement, a wife contested the enforceability, arguing that she lacked legal representation, didn’t comprehend the agreement, and was unaware of its implications.
Despite this, the court upheld the agreement. The court emphasized that Texas law evaluates each case individually, considering the overall circumstances surrounding the agreement’s creation. In this instance, the court noted the wife’s involvement in the husband’s financial affairs and her encouraging her daughter-in-law to sign off on the same agreement (against the daughter’s legal advice).
Bottom line? This case highlights the fact that just because you claim you don’t understand the postnup you sign doesn’t mean that it will be thrown out. In addition, hiring an attorney is important, but lack of one won’t invalidate the agreement in Texas.
(Pearce v. Pearce, 824 S.W.2d 195 (Tex. App. 1992))
Nicole Sheehey is the Head of Legal Content at HelloPrenup, and an Illinois licensed attorney. She has a wealth of knowledge and experience when it comes to prenuptial agreements. Nicole has Juris Doctor from John Marshall Law School. She has a deep understanding of the legal and financial implications of prenuptial agreements, and enjoys writing and collaborating with other attorneys on the nuances of the law. Nicole is passionate about helping couples locate the information they need when it comes to prenuptial agreements. You can reach Nicole here: Nicole@Helloprenup.com
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