Postnuptial Agreements 101
What are the benefits and risks?
Postnuptial agreements are voluntary contracts created by married couples regarding division of assets and liabilities in the case of divorce. Like a prenuptial agreement, the “postnup” requires disclosure of assets and liabilities so that each party can make an informed decision. Note however that a “postnup” cannot address issues related to parental decision-making, visitation, and child support.
When might a couple decide to enter into a postnuptial agreement?
· To protect a business started by one spouse after the marriage;
· To ensure reimbursement for non-marital contributions to a marital asset;
· To provide for greater distribution of assets to one spouse if the other is caught cheating;
· To address inheritance issues (e.g., children and grandchildren from previous marriages);
· To address dissipation of marital assets (e.g., gambling); and
· To ensure a greater distribution of assets to a spouse who, for example, foregoes a career to raise children or continues to work after the other spouse chooses to retire.
Are there risks to a postnuptial agreement?
Like all contracts, postnuptial agreements are binding on both parties unless found unconscionable. Also, a postnuptial agreement that is not properly drafted or executed may be found void by a court during divorce proceedings. If you have questions about postnuptial (or prenuptial) agreements, or any other family law issues, contact a knowledgeable family law lawyer. Call Saxe Law today at (224) 800-1351 to schedule a consultation.