Pre-Marital and Post-Marital Agreements
Couples who plan to marry or who are already married sometimes decide to set property and debt expectations in a premarital or postmarital agreement. These agreements clarify property rights and financial responsibilities, potentially reducing conflict if the marriage ends. Since state laws on property division vary, many people seek an arrangement that fits their wishes rather than relying solely on default rules. In some jurisdictions, statutes such as the Uniform Premarital and Marital Agreements Act may influence how courts evaluate these contracts.
Premarital vs. Postmarital Agreements
A premarital agreement, sometimes known as a prenuptial agreement, is typically drafted and signed well before the wedding date to help ensure both spouses have adequate time to consider the terms. Finalizing it too close to the ceremony can raise questions about pressure or duress. A postmarital agreement, also called a postnuptial agreement, is signed after the wedding. Couples may create a postnuptial agreement if a significant financial change occurs, such as an inheritance or a new business venture, and they feel they need to update their mutual obligations or protect specific assets.
Key Elements of a Valid Agreement
Courts generally review these agreements to verify clarity, fairness, and voluntariness. They are required to be in writing, and each spouse should provide full and accurate financial disclosures to the other. If one spouse was unaware of the other’s financial status or signed under pressure, courts may determine the contract is unenforceable. Couples sometimes begin with a draft listing their property, debts, and financial obligations, and then refine it with help from attorneys. Once signed, the agreement can govern how assets such as real estate, investment accounts, and vehicles are handled if the marriage ends. It can also include terms on handling future financial changes, such as one spouse starting a new business.
Common Examples of Use
Although many associate these agreements with wealthy individuals, they can assist spouses in a variety of situations. Couples who want to preserve certain assets for children from a prior relationship might rely on a premarital or postmarital agreement to ensure that property remains separate. They are also helpful when one spouse brings significant debt into the marriage, allowing the parties to clarify who is responsible for that obligation. Some spouses prefer to manage separate financial lives despite being married and find that an agreement clarifies their respective roles in paying daily expenses, handling a joint account, or maintaining separate accounts for personal use.
Potential Limitations of Agreements
Courts will often set aside provisions that are unconscionable or that provide a clear incentive to divorce. Terms that attempt to dictate child custody or child support are typically unenforceable, since courts must consider the child’s needs and the parents’ ability to meet those needs rather than any predetermined arrangements. In some states, agreements limiting spousal support may not be valid, while others allow spouses to waive or modify this right if they do so while understanding the consequences. Agreements generally focus on financial matters rather than personal lifestyle choices, and attempts to include non-financial expectations may not be upheld.
