Exploring the idea of prenuptial and postnuptial agreements doesn’t make you a bad fiancée or spouse. In fact, it makes you a responsible one!
Even if you are happily married or engaged now, life isn’t always butterflies and rainbows.
Burying one’s head in the sand is never a good strategy, and humanity would do well to face many more realities head on. We hate to break it to you, but if you’re entering into a marriage for the first time, it’s a good idea to be realistic about the possibility of future misfortune.
Sadly, the cold hard fact of the matter is that a whopping 39% of US marriages are predicted to end in divorce. This estimation is based on evidence that shows more than one third of couples didn’t make it till death did them part.
The good news is that the majority of marriages do succeed, and yet there is no harm in taking precautions against the possibility of divorce.
The phrase “love is blind” should be reserved for the honeymoon stage of your relationship, whereafter an objective perspective becomes more beneficial for self and partnership growth.
When a couple gets a divorce, various terms need to be decided. In the case of a contested divorce, courts make the decisions for you. By getting a prenup or a postnup, you can preempt many of the financial hassles and common arguments in divorce court. Below are just some of the things that can be included in a prenuptial or postnuptial agreement.
- Property division: How the couples will split marital assets or marital debts.
- Spousal support: The details of alimony or the waiver of alimony, or any modification within.
- Business interests: If one or both of you hold interest in a business, the prenup or postnup can address how interest and the appreciation of the interest during the marriage will be handled in the event of divorce.
- A prenup or postnup can address any additional terms that a couple wants to focus on that are reasonable, clear, and not in opposition to any public policy. With the exception of any child related support or custody. That’s a no-no!
Prenuptial versus Postnuptial Agreements
In a nutshell, the key difference between a prenuptial and a postnuptual agreement, is whether the contract was created before, or during marriage. A prenuptial agreement is a legally binding contract created before marriage by two partners.
On the other hand, postnuptial agreements are contracts that have been drawn up when couples feel they need more clarity on financial matters during the marriage. It is not uncommon for postnuptial agreement discussions to be sparked by a separation followed with reconciliation, but there are various reasons for acquiring a postnup.
Prenups and postnups are essentially detailed records of how assets and property should be divided in the event of divorce. Not only do the contracts concern property and assets but also income, debt, individual inheritances, joint purchases and more.
In a world of unknowns, one thing is for sure – prenups and postnups can only protect and benefit you in the long run. Although it may feel awkward to bring up this idea with your spouse or fiancée, you may thank yourself later.
Even in divorces that are simple, things can get messy when it comes to the division of assets. And really, who needs to get tied down arguing about individual material possessions when they are trying to move on with their lives?
Reasons to Consider a Prenuptial or Postnuptial Agreement
While prenups and postnups are stigmatized, there is nothing wrong with taking precautions that will protect you (and your kids) emotionally and financially. Unfortunately, there are several hypothetical scenarios that could take you and your partner in different directions!
Although you may be together forever, money doesn’t grow on trees – and asking for a prenup is simply a way of protecting your assets in the event of a split.
Wealthier individuals who are marrying need to beware of how to protect their assets, and a prenuptial agreement is one very good way to do so. This is because these types of contracts allow you to keep your money and assets separate from the marital estate as desired.
You should consider asking for a prenuptial or postnuptial agreement if:
- There are or were large disparities in assets and wealth before marriage
- One partner is expected to receive significant inheritance
A prenuptial or postnuptial agreement outlines whether your possessions (for example a car or house) are the property of you alone – or of the marital estate. If you are way wealthier than your fiancée or spouse, you may consider getting a prenup to ensure there is no ambiguity.
If you missed the chance to get a prenup and are already married, you may consider a postnup. Now, postnups are a different animal than prenups, in that they are not as widely accepted. Some states will not enforce them. Some states enforce them as commonly as prenups. If you are able to obtain a postnup in your state, they allow you to separate your finances. This may include your business and any increase in value that may arise from other assets, among many others.