How to Negotiate a Postnuptial Agreement

Just as a business contract encompasses as many expected situations as possible, a marriage is a legally binding contract. Some people may plan for the possibility that the contract could be terminated in the future. This tutorial gives tips on how to negotiate a postnuptial agreement.

Instructions

1. Understand the reason behind the desire to draw up a postnuptial agreement as you negotiate it. For those who are involved in a family business it serves as a way to ensure the business stays within the family. Other times it protects an inheritance or guarantees that children from a prior marriage are taken care of in the event the current marriage does not work out. Knowing each person's reason for wanting the agreement will help ease the fear that it's a tool to hurt the other party.

2. Make sure each party has fair representation by a qualified attorney throughout the entire negotiation process. Although you are spending legal fees to retain attorneys, the thought is that you will avoid costly legal fees if the marriage were to end in divorce. Having separate and neutral parties negotiating for each of you also increases the likelihood that the agreement will withstand judicial scrutiny.

3. Account for all assets and liabilities, including all future earnings when you negotiate the contract. With the popularity of stock options becoming part of compensation packages, it's essential to include these in the postnuptial agreement.

4. Realize that no matter how much effort you put into planning and negotiating a postnuptial agreement, the judge presiding over the potential divorce has discretion to alter or change the agreement based on what they deem to be fair at the time of the divorce. Postnuptial agreements are relatively new to the world of law, first emerging in the 1980's, so there's not much precedent in many states leaving the courts to have liberal authority over them.

5. Prepare yourself emotionally for the difficult conversation of dividing money and protecting yourself. When you negotiate a postnuptial agreement it's essentially the same as negotiating a divorce settlement. It can certainly bring up a lot of emotions and may cause problems where there were none before.

6. Take the process slowly and if one party is hesitant to sign do not force them to do so. This will almost surely provide a basis for a judge to throw the agreement out, especially if the party under duress fears that they will be divorced if they do not sign. Continue to have talks with each party's attorney and consider a marriage counselor to uncover any hidden troubles that may be leading to the postnuptial or preventing it from being signed.

Tips & Warnings

• Some experts say a postnuptial is asking for trouble by opening a pandora's box with unknown consequences. Both parties need to be not only financially prepared but also emotionally prepared to deal with this issue.