Many couples see no reason to get a prenuptial agreement when they marry. They may be starting out with very little in the way of assets, so it may seem silly to draw up a contract determining who will get what if they divorce. They may also believe – or want to believe – that they’ll be together for the rest of their lives.
Not getting a prenup, however, doesn’t mean you’ve thrown away your chance to work out that kind of contract. You can draw up a postnuptial agreement the day after you marry or decades down the line.
The thought of approaching your spouse with the idea of a postnup may be more daunting than it would have been to ask for a prenup. Many people think it signifies trouble in the marriage. That’s often not the case at all. Let’s look at some scenarios where a postnup may be a wise move.
Significant wealth or financial imbalances
Often, couples draw up a postnup because their financial situation has changed drastically since they married and/or there’s a significant imbalance in the financial assets they’ve contributed to the marriage. Maybe one spouse worked while the other went to medical school and then stayed home to raise the kids while their spouse became a world-renowned surgeon. Both want some financial predictability and protection if the marriage ends.
A new business gets started
If you are the sole owner of a business or entered a new partnership, you want some assurance that your spouse won’t get part of that business in a divorce. If you’re in business with others, all married partners may be required to get postnups to help ensure the continuity of your business.
A large inheritance comes to one spouse
Yes, inheritances are typically considered separate property that isn’t subject to division in divorce. However, that’s only if none of the funds are commingled with marital assets. If you spend part of your inheritance remodeling your jointly-owned home, you’ve commingled separate and marital assets and given your spouse the right to seek a portion of your inheritance in a divorce. A postnup can protect your inheritance.
As with a prenup, both spouses should have their own attorneys involved in the process to help ensure that their rights and interests are protected and that the agreement is beneficial to both of them.