Marriage is one of the most exciting adventures that you can go on. Succeed or fail, every step is a journey and there’s lots to experience. But marriage can also lead to many tricky and not so pleasant situations. The most obvious is divorce. Though divorce is far from the only one, it makes for the clearest example. We all know that marital possessions are divided during a divorce but what happens to personal objects?
One of the ways to protect your personal items is to differentiate between personal possessions and material possessions through a marital agreement. However, this is far from the only reason to have a marital agreement. We’ll explore more below.
But first, we’re going to need to examine the difference between a premarital agreement and a postnuptial agreement. These are both marital agreements, but there are some big differences between them. Then we’ll see who should get a marital agreement, as well as those benefits of martial agreements we alluded to already.
What’s the Difference Between a Premarital Agreement and a Postnuptial Agreement?
Both premarital agreements, aka prenuptial agreements, and postnuptial agreements deal with the same sort of topics and issues. However, it is very important to note that there is a big difference in how the courts treat premarital agreements compared to postnuptial agreements.
The major and most obvious difference between them is that premarital agreements are drafted and signed prior to the marriage and postnuptial agreements are created afterward. While this may seem rather moot, it can be a big deal in the eyes of the court. Couples have a much easier time having a premarital agreement upheld than they do with a postnuptial agreement.
Premarital agreements, as discussed in Section 4.003 of the Texas Family Code, cover issues like the rights that each spouse has in regards to what property they own, which would separate their individual property from the marital property. Changes to the distinction between separate and community property, establishment or waiver of alimony, issues with spousal support, division of retirement or business interests, division of debt, trusts and wills, life insurance, and death benefits are all different topics that a premarital agreement may discuss.
One thing that cannot be changed by any marital agreement (whether before or after marriage) is child support/child custody because the Court will reserve that decision for what the judge sees as best for the child or children when the parties split up.
Now let’s create an example for a better understanding of postnuptial agreements. Say you and your partner don’t have a lot of possessions at the time you get married. But as time passes, you each gain access to more resources as income. But you are both fairly independent and so each of the properties or resources gathered aren’t really for the marriage but for the individual. Without taking extra steps, these would just be lumped together with the rest of the marital property as community property in Texas.
But a postnuptial agreement could be used to separate these properties from one another. This might seem like a pointless step; after all, each of the partners was fine with the other being independent. Yet should that marriage end in death or divorce then there could be issues with how those properties are divided. But a postnuptial agreement, if it is upheld by the court, could function to separate each party’s possessions from the marital property so that they aren’t wrongly divided.
Another important factor to think about is that a premarital agreement can be used to divide debt as well as property. If one person has a lot of debt then rather than pushing that debt onto the marriage, an agreement could be drafted to specify that it is personal and not marital. I’ve seen postnuptial agreements save a marriage that was headed toward divorce, where one party disagrees with the spending habits or business risks taken by the other. A separation of debts and assets is a way to give the risk-adverse or money-saving spouse some protection from the other spouse’s future creditors.
Who Should Get a Marital Agreement?
Not every couple is going to need a marital agreement. For many people, the thought of drafting a marital agreement never even crosses their minds. Yet marital agreements can be powerfully useful tools, regardless of a couple’s socio-economic status.
Times when you may want to consider a marital agreement include:
When either or both parties are going to enter into the marriage with a major debt
When either or both parties have children prior to the marriage
When either or both parties own property prior to the marriage that they want to keep separate from the marital property
When either or both parties have had a prior marriage
When either or both parties want to keep their estate separate and secure from the marital estate
When either or both parties enter into a new business that they need to keep separate from the marriage
Don’t forget that life continues after marriage and there is going to be new property and assets coming in the future. Consideration of how this is to be separated from the marriage is a big topic and it’s a complicated one at that. Don’t be afraid to reach out for advice if you ever get confused about any of the details.
What Are the Benefits of a Marital Agreement?
There are several benefits to marital agreements that we haven’t touched upon yet.
We keep mentioning that it helps to secure your property but not how it actually works. So when divorce proceedings are going on, sometimes the couple is unable to agree on how to divide their property and so the court has to make the decision for them. But a valid marital agreement would override the state laws regarding those properties discussed in the agreement.
It can also help you to protect any children you had prior to the marriage. An agreement can help you to separate marital property from property that is intended to be passed down to your children or assets that were meant for them like their college education fund. That fund would have become part of the marital property and end up divided as such, whether by divorce decree, by a Will or by inheritance laws, but the agreement kept it separate so it could go to the intended party. Or, for example, the parties could agree that any jewelry, guns, or other specific collectable items, bought during the marriage would be the separate property of one spouse or the other, and thus not divisible in case of divorce or death. On the other hand, the marital agreement can protect the current spouse from the adult children and give the current spouse peace of mind knowing that they won’t be forced by the other spouse’s adult children to move out of a deceased spouse’s separate property house.
Should We Work With an Attorney on Our Marital Agreement?
You should absolutely work with an attorney. Creating an agreement is easy enough, anybody can do that. But the problem is that you need to create an agreement that is legally enforceable and this can be much trickier. Premarital agreements are more likely to be honored than postnuptial ones, though both can be honored.
But since there is a history of the state disregarding marital agreements, it’s important to work with an attorney to draft an agreement that is likely to be accepted based on what has and hasn’t been historically enforced. The attorney may suggest some things that you had not even thought to discuss and may help clear up any wording that could be interpreted differently than you intended. The attorney may point out some possible scenarios where what you thought was a good agreement might actually not be beneficial for either party. Most importantly, the attorney can help you make sure that the whole agreement won’t be thrown out because of some technical requirement that you didn’t know about. That way you won’t find out at the worst possible time that the agreement you thought was protecting you was actually unenforceable and you’ve lost everything.