Postnuptial Agreement

Many people are familiar with what prenuptial agreements are. But if you don’t have a prenup, it's important to be aware that there is another type of agreement you can enter into to protect your assets. A postnuptial agreement is a contract that can be entered into at any point during your marriage if you anticipate divorce or you want clarity regarding the way in which your finances and property will be managed and owned. While both contracts can accomplish similar objectives in Maryland, the main difference between a prenuptial agreement and a postnuptial agreement is timing. Specifically, a prenup is signed before the couple is married — a postnup can only be signed after marriage.

What is a Prenuptial Agreement?

A prenuptial agreement (often referred to as a “prenup”) is a legal contract entered into between a couple prior to marriage. It can outline the couple’s financial expectations for the marriage, establish their financial responsibilities, and determine how property would be divided if they legally part ways. Critically, if a couple later decides to divorce, a prenup can help avoid lengthy and contentious litigation over the division of assets.

Prenups aren’t only useful in divorce — they can cover a wide range of financial topics related to marriage. Prenups can be used to:

• Outline how financial matters will be handled during marriage
• Define separate and marital property
• Clarify how retirement savings will be handled in the event of divorce
• Specify who is responsible for certain debts
• Safeguard your business interests
• Establish alimony
• Determine pet custody matters

Prenups cannot be used to determine child support or child custody matters. In order to be valid and enforceable in the event of divorce, a prenup must be signed by both parties and entered into voluntarily. Both parties must also have made full financial disclosure and had the opportunity to consult with their own attorney (even if a person decides to sign without the benefit of counsel). If a judge finds that the prenup is unfairly one-sided or was entered into under duress, it may be deemed unenforceable and set aside. It can be very difficult to have a prenuptial agreement set aside once signed.

What is a Postnuptial Agreement in Maryland?

When determining whether a prenuptial agreement or a postnuptial agreement is right for your situation, it’s important to understand how each contract can be used. A postnuptial agreement is a contract that is entered into after the couple is married — as opposed to before the marriage takes place. A postnuptial agreement can address the same subject matter as a prenup, and the same rules for enforceability apply. Notably, if you did not sign a prenup, a postnup can be a second chance to protect your assets.

Postnuptial agreements can be beneficial in the following situations:

• Divorce is anticipated, and you did not protect your property with a prenup
• There have been changes in your financial circumstances
• Your financial goals have evolved
• You received an inheritance
• You started a new business during the marriage
• One spouse has incurred substantial debt
• There is a financial imbalance in the marriage

Like a prenup, a postnuptial agreement in Maryland can be used in connection with estate planning. It can clarify your spouse’s property rights and ensure that children from a previous marriage are provided for in accordance with your wishes.

What are the Pros and Cons of Signing a Prenuptial Agreement vs. a Postnuptial Agreement?

While both documents can effectively cover the same issues, if timing is not an issue - it’s vital to consider the pros and cons of entering into a prenuptial agreement vs. a postnuptial agreement. While marriage is an economic relationship as much as it is an emotional one, a prenup can help ensure you and your future spouse are on the same page when it comes to finances before you are bound by Maryland law. This can help reduce contention over these matters during your marriage.

It’s best to safeguard your property from the start. Even with the option to execute a postnup, if you do not enter into a prenup, you are essentially leaving your assets unprotected. However, if you acquire assets you had not anticipated or your financial situation evolves during your marriage, a postnup can address these changes and protect the new assets.

Although they can serve a similar purpose and offer a similar protection, courts tend to scrutinize postnuptial agreements in Maryland more than prenups. A prenup is signed when the couple still has the option to not marry — with a postnup, the couple is already married, and one spouse might have more financial control than the other. Courts want to ensure a spouse was not pressured into signing a postnup just because they feel as if they are financially dependent or wish to avoid conflict within marriage.

Contact an Experienced Maryland Divorce and Family Law Attorney

If you would like to learn more about whether a prenuptial agreement or a postnuptial agreement is right in your situation, it’s best to discuss your specific circumstances with a knowledgeable divorce and family law attorney. At the Law Office of Shelly M. Ingram, our Fulton, Maryland divorce attorneys provide our clients with high-quality legal services for a wide variety of divorce and family law matters — including drafting, negotiating, and litigating prenuptial and postnuptial agreements. Trained in collaborative divorce, mediation, and traditional divorce litigation strategies, we work closely with our clients to achieve favorable results in every case.

To schedule a confidential consultation with an experienced Maple Lawn divorce attorney, call us at (240) 652-2596">(240) 652-2596 or contact us online.

Most people are familiar with prenuptial agreements and how they function. However, it’s important to understand that if you and your spouse did not sign a prenup before you were married, you still have the opportunity to enter into a postnuptial agreement. These contracts can be signed at any point during your marriage and can address a wide range of financial issues — as well as protect your economic interests in the event of divorce.

Here are seven reasons you should consider a postnuptial agreement:

1. You Would Like to Clarify Financial Expectations

A postnuptial agreement has a significant advantage over prenuptial agreements — these contracts can be entered into at a time when spouses have more knowledge regarding their marital finances. They may be better informed about their financial needs than they were prior to the marriage. Importantly, a postnuptial agreement can be used to help spouses clarify financial expectations and reduce misunderstandings by encouraging them to have an open and honest discussion about money and property matters.

2. You Have Received an Inheritance

If you have received a large, unexpected inheritance, it’s vital to take the necessary measures to protect it. While inheritances are treated as separate property in Maryland, they can sometimes become commingled with marital property — this can complicate asset division in cases where a couple parts ways. An inheritance can be included in a postnuptial agreement to ensure that it remains the property of the spouse to whom it was bequeathed.

3. You Have Brought Significant Assets into the Marriage

If you entered into the marriage with significant assets or acquired them during the marriage, a postnuptial agreement can help to protect your wealth in the event of divorce. This would ensure that spouses part ways while keeping the individual wealth they have accumulated intact.

There are numerous reasons to consider a postnuptial agreement, from asset protection to business interests and financial security. A knowledgeable attorney at the Law Office of Shelly M. Ingram can draft, review, and negotiate a solid postnuptial agreement to ensure your interests are safeguarded in case of separation.

A postnup can address a wide range of assets and property, including but not limited to the following:

• Real estate
• Investment properties
• Investment portfolios
• Retirement funds
• Personal property
• Vehicles
• Artwork
• Jewelry
• Family heirlooms

A postnuptial agreement can also address many other financial matters, such as how debts accumulated during the marriage would be handled, whether spousal support would be issued in the event of divorce, how certain properties would be managed, and who would be responsible for attorneys’ fees in divorce.

4. You Own a Business

If a spouse owns a business, dividing it in divorce can be one of the most contentious issues you may face during legal proceedings — especially if the business grew substantially during the marriage. Significantly, a postnuptial agreement can protect business interests by:

• Classifying business assets as separate property that remains with the original owner after divorce
• Preventing disruption to your business after divorce
• Specifying how the business will be managed
• Protecting the interests of business partners
• Outlining each spouse’s financial responsibility and obligations toward the business
• Reducing the potential for lengthy and costly litigation

With a solid postnup in place, you can continue to focus on your company’s growth and operations without concern that divorce proceedings could interfere. In addition, it can also show lenders that your company is a stable investment.

5. You Would Like to Financially Protect Children from a Prior Marriage

If you have children from a previous marriage, a postnuptial agreement can be used in connection with your estate plan to ensure your children are provided for. By specifying which assets are considered separate property and how they should be distributed in the event of divorce or death, the assets can be safeguarded for your children. The agreement can address things such as money, inheritances, financial accounts, family heirlooms, and other assets that you would like passed down to your children.

6. There are Unexpected Financial Imbalances in the Marriage

Not all financial issues in a marriage can be addressed in a prenuptial agreement. In some cases, there may be unanticipated events or unexpected financial imbalances that arise during the course of a marriage. For example, if one spouse takes on homemaking or child-rearing responsibilities while the other spouse seeks employment outside the house, the financially dependent spouse might want to seek assurance by addressing alimony issues in a postnuptial agreement.

7. You Did Not Enter into a Prenuptial Agreement

If you didn’t enter into a prenuptial agreement before you were married — or did and financial circumstances have changed — a postnuptial agreement can be used to protect your interests. In the event divorce is imminent, a postnuptial agreement can safeguard your separate property, establish the division of assets without judicial intervention, and help spouses avoid litigation.

Contact an Experienced Maryland Divorce and Family Law Attorney

There can be a wide range of reasons to enter into a postnuptial agreement. A skillful attorney can draft, review, and negotiate a postnuptial agreement that will be legally sound if you and your spouse choose to part ways. At the Law Office of Shelly M. Ingram, our Fulton, Maryland divorce attorneys are committed to providing you with high-quality legal services for a wide variety of divorce and family law matters, including those involving prenuptial and postnuptial agreements. Trained in collaborative divorce, mediation, and traditional divorce litigation strategies, we will help you achieve a positive outcome for your specific situation.

To schedule a confidential consultation with an experienced Maple Lawn divorce attorney, call us at (240) 652-2596">(240) 652-2596 or contact us online.