Bringing up the idea of a postnuptial agreement with a spouse can be a delicate matter. Some spouses feel that making a postnup signifies a lack of faith in the marriage. Still, some couples find that postnuptial agreements actually strengthen their unions, particularly when it comes to addressing their financial situations.
A postnuptial agreement is basically a prenuptial agreement composed and signed after the marriage. Some spouses fail to make a prenup but later decide their marriage could benefit from a postnuptial contract. According to U.S. News and World Report, a postnuptial agreement may help spouses with the following financial situations.
One or both spouses are wealthy earners
Money is often the center of many divorce battles. The fact that one or both spouses have a lot of personal wealth can be enough to motivate them to sign a prenup. Still, even if high earning spouses have missed out on a prenuptial agreement, it is still possible, perhaps even crucial, to create a postnuptial accord to address what will happen to their wealth.
One of the spouses has come into money
Some couples marry while earning a modest living, only for one of the spouses to inherit a lot of money. For the moment, the inheritance may remain separate property. However, the spouse may someday mix some of those funds in with a marital account. A postnuptial agreement could clarify that an inheritance remains separate property and ineligible for property division.
One of the spouses will stay home
A postnuptial agreement can also reassure a spouse who could face a hard financial life after a divorce. A wife or a husband may stay home and raise the children. Doing so can give up earning years and prevent the at-home spouse from putting money away. A couple could make a postnuptial contract that provides enough of a post-divorce share for the at-home spouse that he or she will not face poverty.
One of the spouses spends frequently
Some spouses struggle with bad spending habits such as racking up big credit card bills or acquiring gambling debts. A high spending spouse may recognize that his or her habits are endangering the marriage and suggest making a postnuptial agreement to keep the other spouse from incurring the other’s debts. Doing so may lessen marital stress and head off a possible divorce.