We’re all familiar with the prenuptial agreement, commonly referred to as a prenup, but lately, more couples are becoming acquainted with the very similar postnuptial agreement (postnup) and the benefits it affords to couples. The biggest difference between a prenup and a postnup is that the latter happens after the marriage. While anyone can choose to add a postnup, it’s a great solution for certain couples with more complicated financial issues or family dynamics that would benefit from the clarifications it provides.
What is a Prenuptial Agreement?
Before you can decide whether you need a prenup or can wait for a postnup, you need to make sure you understand the benefits and limitations of each document. For many couples, getting a prenup is part of their pre-wedding planning. A prenup is a contract between two people that happens before the marriage to protect each individual’s financial and personal interests should either party die or there’s a divorce. A prenup will itemize the couple’s assets and debts, and it will also determine what rights each person has to all the property after the marriage. A prenup can also protect family heirlooms, inheritances, and any property that an individual may want to remain in their family of origin.
What is a Postnuptial Agreement?
For couples who are married but didn’t sign a prenup, a postnup can be a tidy solution to any issues that are creating worry in the marriage. With a postnup, you can protect some of your assets after the marriage.
Postnups can benefit couples who need clarifications for issues that may not have existed when they first got married. Life happens, and change can be a source of stress and strain on your marriage. Maybe with the pandemic, one party lost their job, and now you fight over money regularly. Maybe a child that you didn’t know about has come into the picture. There are countless issues that life throws at couples every day, and legal tools like postnuptial agreements can help provide clarity where there is currently chaos.
Who Should Get a Prenup or Postnup?
Now that we’ve clarified the difference and benefits of both options, deciding which one would be the ideal solution for your situation can still present a challenge. Couples stress about choosing between the prenup and postnup because it’s not like you can go back in time and fix it if you opt for the wrong tool. For certain couples, a prenuptial agreement may be a non-negotiable issue. If you are entering a marriage with significant assets that you need to prevent from becoming community property or co-mingled assets, a prenup is required to meet those goals. If you have more assets than your spouse or you are considerably older, a prenup may be preferable to a postnup. This is especially true if there are previous marriages with children you want to receive the bulk of your estate. By not getting a prenup, state law will automatically give your spouse rights to your estate that may not be consistent with your estate plan. Postnups can sometimes end up being a catchall for couples who ran out of time to clarify some issues before the marriage, but sometimes they are used by couples who inherit property late into the marriage and want to clarify who owns it. They may also want to determine where the inheritance will go if they die before their spouse.
If you are interested in drafting a prenuptial or a postnuptial agreement, we can help. Call the legal team from Mitchell & West LLC today at (305) 783-3301 to schedule a consultation.