Prenups vs. Postnups: Choosing the Right Contract for Your Relationship

Divorce isn't something you really want to think about when you're getting ready to walk down the aisle. But if you have a lot of assets, once you get married, what’s yours becomes your spouses by law. If the marriage falls apart, you could lose what you’ve worked hard to earn.

Having a prenup or postnup agreement may help you protect what’s yours if you end up in divorce court. The difference between the two is when they are signed.

A prenuptial agreement, or prenup, is a contract between you and your future spouse on what will happen with your assets, debts, and other matters if your marriage dissolves. A prenup is written up and signed by you and your future spouse before you marry.

If you get married without a prenup and then find out your new spouse is swimming in debt you don’t want to be part of, you can still put together an agreement on how your assets will be managed.

A postnup is similar to a prenup, except it's written and signed after a couple is married. Like a prenup, a postnup can outline how assets and debts will be separated if a couple divorces.

A postnup doesn’t have to be written up right after you tie the knot. You and your spouse can put together a postnup after five, 10, or even 20 years of marriage. You can even sign a postnup agreement when you still have a prenup in place.

There are pros and cons to both prenup and postnup agreements. Both agreements outline how finances should be handled in the event of a divorce or the death of a spouse. In the case of a prenup, your betrothed may be offended by you even mentioning wanting an agreement in place. Working together after you’re married to create a mutually beneficial postnup may be easier to agree on.

Another advantage of having a postnup is that if things in your marriage start to get rocky, especially when finances are concerned, a postnup may be a way to sort things out and save the marriage.

A postnup may also be a good idea if this isn’t your first marriage and you have children from a previous marriage. When you’re married, if you die, the majority of your assets go to your surviving spouse. In a postnup, you can designate that your assets go to your children instead of your surviving spouse.

On the downside, postnups can be harder to enforce than a prenuptial agreement. Since they occur after the marriage, there's a higher chance that one spouse can be coerced into a postnup with which they aren’t 100 percent in agreement.

Both prenup and postnup agreements can be deemed invalid for the same reasons. The contracts are invalid if one of the spouses was coerced in any way into signing it. It can also be thrown out for any unreasonable or unfair provisions to one of the spouses involved or if it violates state law.