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The value of a postnuptial agreement

On Behalf of | Feb 11, 2022 | Family Law

Many people in Alabama and elsewhere know that a prenup is a document that a couple signs before they even go down the aisle that keeps certain property such as real property, personal belongings, or even a business, separate from shared marital assets. To some, this may not seem like a very romantic way to begin life together, but to others it is a pragmatic means of handling business affairs.

The same can be said for a postnuptial agreement. People usually come to the realization at some point that marriage is a financial commitment, and protecting their assets becomes more important over time. It is never too late for couples in Montgomery and surrounding areas to make decisions that will both protect their financial futures in the event of a divorce, and clarify their expectations for their marriage.

Common motivations to create a postnuptial agreement

When a couple decides to enter into a postnup after having been married for some time, it is often a lookback at what they might have done in a prenup had they thought about it before marriage. But, where a prenup outlines a spouse’s separate assets before marriage, the longer the couple is together, the more complex the commingling of marital assets. Some motivating factors that can develop over time include:

  • One spouse starting up a new business and wishing to protect it and any business partners from the fallout of a divorce proceeding.
  • A spouse who stopped working to raise a family may wish to guarantee their financial future if there is a split up.
  • A change in financial sources or circumstances, either through job loss or indebtedness, that may require clarity on future debt responsibility in a divorce.

A postnuptial agreement is also an effective estate-planning tool that can target asset allocation to children from a prior relationship.

Postnuptial agreements in Alabama

Alabama is an equitable distribution state, which means that in a divorce settlement, it is up to the discretion of the judge what is a fair, but not necessarily equal, distribution of marital assets. Although there is a no-fault divorce option in the state, there are other grounds for divorce, such as adultery, desertion, or cruelty, that can factor into a judge’s ruling on property division.

For a postnuptial agreement to be valid in Alabama, it must be signed freely by both spouses, not under duress, and must include a fair division of property in a divorce.


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