Crafting Your Shield: Navigating Prenups vs Postnups with Our Oakland Divorce Attorneys
Most couples marry in the expectation that their relationship will last a lifetime. At the same time, they may also be aware that whatever their intentions, a significant fraction of marriages end in divorce. Finances are frequently among the most contentious issues in both marriage and divorce. A prenuptial or postnuptial agreement—a written contract between spouses that allows them to agree upon their property rights during marriage and if the marriage ends in divorce or death—can be an effective means to avoid future problems and to keep from having default state laws take key decisions out of their hands. However, without experienced legal representation on both sides, it is easy to create such an agreement that fails to meet state requirements.
If you’re wondering, “Is a prenup or postnup right for my situation?,” here’s information you should know, gained from Hart Ginney’s extensive experience working with couples who have benefited from putting these types of agreements in place.
Considering a Prenup or Postnup?
What Are the Pros and Cons of a Prenup or Postnup?
In California, during a couple’s marriage, what they earn, the things they buy with that money, and the debt they take on is all considered community property. That property belongs to both spouses equally, and in the event of a divorce, it is supposed to be evenly split. Separate property—what each owned or owed before the marriage, as well as gifts or inheritances given to one spouse—is not considered community property. In practice, however, it is rarely in the best interest of either party to divide all assets strictly down the middle, and the distinction between separate property and community property is often muddied by how those assets are treated.
Creating a prenuptial or postnuptial agreement facilitates a frank and open discussion around finances that can provide clarity and certainty regarding marital property for each spouse. Prenuptial agreements in particular can set up healthy boundaries and mutually understood expectations prior to marriage that may help defuse potential conflicts. Should the marriage end in divorce, a prenup or postnup also simplifies the division of assets and debts because the terms have already been agreed upon, reducing the expense and stress involved.
One of the primary reasons a couple might hesitate to seek a prenup or postnup is the perception that even asking for one indicates a lack of commitment to the relationship. However, the willingness to approach financial issues with transparency, with an eye to crafting a mutually beneficial agreement, is more likely to strengthen a healthy relationship than weaken it. The con that should be of more concern is that many prenups and postnups don’t stand up in court. If your agreement is not well drafted, or contains illegal provisions, it could be thrown out, leaving you at square one regarding property division if you seek a divorce.
The Difference and Similarities Between Prenups and Postnups
The key difference between a prenuptial agreement and a postnuptial agreement is when the legal arrangement is formed. Prenups are entered into before the couple is married, while postnups can be created at any point after the wedding—even years or decades later. In California, this difference in timing means there are different requirements for ensuring that the agreement will be seen as valid and enforceable should the marriage ultimately end in divorce. (We’ll get into those details below.)
Both types of agreement can accomplish the same thing: allowing a couple to define their property rights through a mutually agreed upon contract in a way that differs from California’s community property rules. This can include defining what is to be considered separate property versus community property, assigning responsibility for debts during and after marriage, and determining who will receive certain assets if the marriage dissolves. However, neither can be used to establish child custody or child support. They also can’t include terms that would violate public policy or criminal statutes. For example, a prenup can’t be written to “punish” a spouse for infidelity, because there is no at-fault divorce in California.
It is essential to understand what can be legally included in a prenup or postnup and the requirements for ensuring such an agreement will hold up in California courts. Employing experienced family law attorneys to help negotiate and draft your agreement can help prevent this.
Who Can Benefit from a Prenup or Postnup
While it’s often believed that prenups and postnups are only for the extremely wealthy, in truth there are many circumstances that can make having one a wise precaution. Examples include:
- When there is a significant difference in income or net worth between spouses
- When one spouse owns a business before marriage
- When it is a second or third marriage, and one or both spouses have children from previous relationships
- When one spouse plans to or has taken significant time out of the work force to raise the couple’s children
- When one spouse expects to receive an inheritance or distribution from a family trust
- When a married couple’s financial situation has changed significantly due to an increase in income or debt
If dividing your assets and debts right down the middle sounds like more of a nightmare than an equitable solution, then it is worth exploring whether a prenup—or, if you’re already married, a postnup—might be the right move.
Prenups and Postnups in California Law
While prenups and postnups serve the same purposes, they are not treated exactly the same in California. Both must be in writing and signed in the presence of a notary. However, prenuptial agreements are governed by California Family Code § 1615, and are considered to be valid if both parties have fully disclosed their finances, both had the capacity to enter into the agreement, both entered the agreement voluntarily (not under duress, fraud, or undue influence), and there was a minimum of seven calendar days between when the final agreement was exchanged and when it was signed. Both parties should have independent legal representation as well. The courts assume a California prenup is valid unless it is shown to be otherwise, because future spouses have the freedom to refuse to sign or to call off the wedding if the terms are unfair.
Postnuptial agreements undergo more legal scrutiny because married couples already have rights and duties to one another that would be affected. The courts will be highly alert to any hint that one party was pressured into signing, didn’t receive full financial disclosure, or didn’t have appropriate legal representation. If the agreement is judged to be unconscionable—or unfairly disadvantaging one party—it can also be thrown out. This makes it even more critical to have expert legal representation while creating a postnup to ensure that it can hold up to legal challenge.
Your Bay Area Resource for Pre- and Postnuptial Agreements
The knowledgeable family law attorneys at Hart Ginney LLP are your go-to allies for setting the terms of property rights in your marriage. We provide expert guidance on choosing and implementing effective prenuptial and postnuptial agreements to Bay Area couples to give them peace of mind and clarity. To schedule your consultation, call our East Bay office at (510) 628-0250 or fill out the form below today.
1939 Harrison Street, Suite 210
Oakland, CA 94612