What Is a Postnup? 5 Ways They’re Better Than Prenups

Amid the excitement of wedding plans, a prenuptial agreement may be the last thing you have energy or enthusiasm for. After all, the purpose of a prenup is to specify how you’ll divide your marital assets in the event of divorce.

That's just one reason why a postnuptial agreement, or postnup, is a more practical alternative for many couples. Like a prenup, a postnuptial agreement is a contract that describes how a couple wants to handle assets and spousal support if the marriage dissolves. However, instead of signing before the wedding, a postnup is agreed to after a couple is legally married.

By opting for a postnup instead of a prenup, a couple can enjoy the wedding and then take their time arriving at a fair and reasonable agreement. A postnup is also a good alternative for couples who have been married for years but find their financial situation has changed since they said their vows.

Postnups vs. prenups: What they cover

A postnuptial agreement is similar to a prenuptial agreement in every way except for the time when the legal agreement is signed. A postnup can be agreed to any time after the couple is legally married, even years after the wedding.

Because prenuptial agreements and postnuptial agreements deal with marital property division, it’s critical each spouse make a complete and fair disclosure to the other about their assets, including money, property, and interests in business. They should also disclose all debts.

The ultimate purpose of both a prenuptial agreement and a postnuptial agreement is to make things simpler, more predictable, more fair, and less expensive and contentious if you ever do divorce. A side benefit is that the negotiation process helps the couple better understand each other’s financial situation, concerns, and goals. This enhances trust and can lead to a pattern of honest communication that will strengthen your marriage.

Here are some of the provisions typically included in both prenuptial agreements and postnuptial agreements:

• Separate property. This section identifies assets that are the separate property of one spouse and not marital assets that should be divided. Typically, this might include such things as inheritances, college funds, retirement accounts, and premarital assets.
• Division of assets. These clauses specify who gets which marital assets if the marriage ends, including bank accounts, retirement accounts, real estate, the family home, and ownership interests in businesses. If you live in a community property state, you should know that most marital property is split 50-50 unless you agree otherwise.
• Ownership of debts. This section specifies who’s responsible for paying student loans, tax liabilities, credit cards, and other kinds of debts.
• Spousal support. The agreement may specify the amount and duration of spousal support.
• Life insurance. The agreement can describe any right of a spouse to life insurance proceeds.

By law, a prenup or postnup cannot cover child custody, child support, or child visitation for existing or future children. If you include these items in your agreement, it could be ruled invalid in court.

5 benefits of a postnuptial agreement over a prenuptial agreement

Although postnuptial agreements and prenuptial agreements function in the same way, there are several reasons a postnuptial agreement may be better suited to your situation.

1. Minimize the pressure

A prenuptial agreement can feel like an ultimatum. If your spouse-to-be asks you to sign one, you may worry that your fiancée won’t marry you unless you sign. If you ask for a prenup and your fiancée reacts badly, you may be reluctant to broach the subject again for fear of rocking the boat.

Once you’ve tied the knot, the pressure is off because you’ve already committed to each other. Although no newlywed wants to think about what happens to their assets in the event of a divorce, the process of negotiating a postnuptial agreement can benefit your marriage by prompting honest discussions about financial assets and liabilities and future plans and goals.

2. Put romance first

With their focus on divorce, prenuptial agreements don’t seem very romantic—and that’s one of the biggest complaints about them. A postnuptial agreement allows you to fully embrace the romance of the wedding ceremony and deal with legal and financial matters later.

3. Give yourselves more time

The weeks before the wedding can be hectic, and you may not have much time for financial discussions. Because a prenup must be completed before you’re married, there’s a risk you’ll rush the process and not give it the careful thought it deserves. That, in turn, could make the agreement vulnerable to being overturned by a judge in the event of a divorce.

By waiting until after you’re married for a postnuptial agreement, you give yourselves more time to discuss each of your financial situations and your plans for the future. This increases the chance you’ll arrive at a solution that will protect both of you.

4. React to changing finances

Your personal and financial situation can change dramatically over the course of your marriage. A postnuptial agreement can respond to those changes in a way that gives you and your spouse a sense of security and certainty in the event of a divorce. Some of the life changes that might warrant a postnup include:

• One party comes into a substantial amount of money or property. This might be an inheritance from one spouse’s parents, a windfall from your job, proceeds from the sale of a business, or something else. Assets acquired after marriage and co-mingled assets may become joint property rather than the separate property of one spouse unless you agree otherwise.
• One spouse leaves the workforce for any reason, including going back to school or caring for a child or parent.  A postnuptial agreement can assure that the stay-at-home spouse will be provided for if there’s a divorce.
• One spouse has debts that the other spouse doesn’t want to be responsible for.
• You own a business and want to ensure you’ll retain your full ownership interest in the event of divorce.  

5. Be proactive if divorce seems possible

Many couples sign postnuptial agreements because they’re having difficulties in their marital relationship. A postnup allows the couple to work out what would happen in a divorce while still considering the possibility of staying together. If they ultimately do split up, then many of the issues in the divorce will already have been agreed upon.

Is a prenup or postnup best for you?

Although there are many advantages to postnuptial agreements, some couples prefer to negotiate a prenup before the wedding and begin their married life knowing the legalities are taken care of. Ultimately, the decision between a prenup and a postnup is for each individual couple to make.

Regardless of which you choose, it’s important to be respectful and make a fair and honest financial disclosure to each other. Ideally, each of you will have your own family law attorney review the agreement before you sign it.

FAQs

How long do I have to make a postnuptial agreement after getting married?

There’s no time limit on when you can sign a postnup. It can be created right after the marriage license is signed or years later. However, it’s best to negotiate a postnup when your relationship is strong enough that you can approach the task with a sense of honesty and fairness.

What makes a postnuptial agreement valid?

A postnuptial agreement is a legal contract governed by state law. It must be a written agreement signed by both parties, and some states may require notarization. Some states may have additional requirements. For example, in California, you must wait a week after receiving the document before signing it.

Will a court enforce a postnuptial agreement?

A postnuptial agreement can be valid and enforceable if it complies with the law. However, if one party challenges it in divorce court, the judge may decide not to uphold it. Common reasons to challenge a postnup include failure to fully disclose assets and debts, evidence of coercion, evidence that the agreement was signed under duress, or if the agreement is unconscionably unfair to one spouse.

A court may also decline to enforce all or part of the agreement if it includes provisions about child custody or child support. To increase the chance that your postnuptial agreement will hold up in court, it’s wise for each of you to have independent counsel review the agreement before you sign. 

Can a prenup be modified after marriage?

If your prenuptial agreement has language that permits it to be modified or revoked, then you may be able to amend it after marriage. If you cannot amend it, you may be able to create a new postnup instead. A family law attorney in your state can advise you.

Do I need a postnuptial agreement?

Not everyone needs a postnuptial agreement. However, postnuptial agreements may be especially useful if one spouse has significantly more assets or makes significantly more money than the other. Postnups are also commonly recommended if you have contemplated divorce but are on good terms for now, if one spouse comes into the marriage with assets they want to protect as their separate property, or if one spouse has taken time off work for caregiving.