Whilst Postnuptial Agreements are similar but not identical to Prenuptial Agreements it is still an equally effective legal document.
What Is A Postnuptial Agreement?
A Postnuptial agreement is a new development under U.S. law. Prior to the 1970s, they were generally not enforceable as it was the legal standpoint that a married couple became a single unit at the time of their marriage and a single person or entity cannot enter into an agreement with itself.
A definition of a Postnuptial Agreement is that it is a legal entered into by two people after they have been married. This agreement, similar to a Prenup, is a document that specifies how property, debts and other assets will be divided in the event of a divorce.
What is the difference between a Prenuptial and Postnuptial Agreement?
The only difference between a Prenuptial agreement is that this is a contract entered into prior to marriage and a Postnuptial Agreement is created during the marriage rather than beforehand.
Why is a Postnuptial Agreement important?
They are important in providing clarity to couples in determining the division of assets. A Postnuptial Agreement is important as it is similar in purpose to a prenuptial agreement but is entered into after a marriage ceremony.
They outline what you and your partner want to happen to your money and property if your marriage or civil partnership were to end.
You might want to consider getting a Postnuptial Agreement for a number of reasons, but the most common are:
- You didn’t enter into a prenuptial agreement before getting married
- You and your partner separated, but have now reconciled your relationship
They can also modify terms in a previously executed Prenup.
With that in mind, a Postnuptial Agreement is useful for couples who are now married and possess more insight into the dynamics of their lives allowing them to have stronger opinions on how they wish to disseminate assets should in the event of a divorce.
Why should you consider a Postnuptial Agreement?
There are many reasons to consider this agreement. It is possible that you did not have enough time prior to the wedding to discuss or draft a Prenuptial Agreement and with a postnuptial agreement, you can have the same financial considerations.
Other circumstances that you may consider entering into a Postnuptial Agreement:
- Regret that you did not enter into a Prenuptial Agreement.
Thanks to the similarities between a Postnuptial Agreement and a Prenup, this legal document can offer similar protections for couples who wish they had discussed or entered into a Prenuptial Agreement.
- One party plans to open a business.
Theyt can protect the business and any business partners.
- Financial circumstances have changed.
There may be situations in which financial circumstances for one, or both, parties have changed and whatever the case, this agreement can be used as a tool to determine how this is handled between both parties.
- One spouse stopped working during the marriage.
In instances where one party may have given up their employment and as such their salary to stay home and raise the children, for example, a this agreement can ensure the nonworking spouse has measures in place to ensure that they are protected in regards to remuneration..
- Estate planning
This is to say that these agreements can help achieve a range of estate planning aims for couples.
What should you have in a Postnuptial Agreement?
To be valid and enforceable, these agreements must, at a minimum, meet the following basic requirements:
- Be Written
- Be Voluntary – There should be no indication of coercion or duress.
- Disclosure – Full and fair disclosure is another element of valid and enforceable postnuptial agreements.
- Fair – they must not be unconscionable. A postnuptial agreement that is one-sided or that is otherwise extremely unjust toward one party, based on the facts and circumstances, will not be enforceable.
- Validly executed – they must meet the requirements of the laws of the parties’ state of residence.
Other terms to consider:
- Division of property and assets.
- Spousal maintenance
- Marital debts
What cannot be included in a Postnuptial Agreement?
There are terms that are not enforceable through this agreement and this includes issues related to child custody or child support. The agreement cannot attempt to include terms that attempt to regulate routine aspects of a marital relationship.
Can a Postnuptial Agreement be updated?
Short answer, yes! When drawing up the first draft of your agreement it is possible to include what is known as a ‘review clause’. This is where you build in a provision for the agreement to be reviewed, either after a certain period of time or when a specified ‘trigger’ event occurs, for example the birth of a child.
Is a Postnuptial Agreement enforceable?
Enforcement of a these agreements can vary by state law. At present, most courts tend to uphold the agreements as long as they’re written, signed without coercion, and involve a full disclosure of financial information on both sides.
However, some jurisdictions may include additional requirements. For example, in New Jersey, a Postnuptial Agreement must be considered “fair and just” in order to be enforceable. Whilst in California a Postnuptial Agreement must reflect the “highest good faith and fair dealings.”
How much can a Postnuptial Agreement cost?
This depends on the complexity of the estates of both parties and the costs of the agreement can be as expensive as a Prenuptial Agreement ranging from $1,500 to $10,000.
We, at go NDA, believe in making all things legal affordable. Our go NDA mobile app can help reduce legal costs with our affordable subscription service and with our template library you can save time by executing documents within our mobile app.
This agreement is a document that serves as a tool of protection, with either spouse standing to benefit.
Are you looking to create a Postnuptial Agreement that is compliant and thereby enforceable? Visit our mobile app – go NDA – to access our template library where you can execute, in real time, a Postnuptial Agreement today!