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Is a postnuptial agreement right for you?

A postnuptial agreement is a legal contract signed after marriage or civil partnership which sets out what the financial settlement should be if the relationship does not work out and leads to divorce or dissolution of civil partnership.

This article will summarise why signing a postnuptial agreement could be beneficial for you and your spouse or civil partner and offer an insight into why it might be the right choice for you.

Why a postnuptial agreement?

Couples who opt to sign a postnuptial agreement sometimes  do so if  they did not have the time or desire to sign a prenuptial agreement prior to their marriage. In other situations, a postnuptial agreement may be entered into to protect assets that are to be passed down to one of the parties during a family succession planning exercise.

A postnuptial agreement can be entered into at any time after marriage or civil partnership.

Anyone who wishes to protect their finances and assets can sign a postnuptial agreement, including individuals with property they wish to protect, those wishing to set aside inheritance for family members,  those who wish to protect assets they have inherited or will inherit and those who wish to protect business interests.

While a postnuptial agreement is not technically legally binding, because such agreements cannot oust the jurisdiction of the court in England and Wales to use its discretionary powers to redistribute the assets and incomes of the parties, a court will only impose an alternative outcome if the agreement leaves one of the parties in a “predicament of real need”. When entered into correctly, with legal advice on both sides, the terms of a postnuptial agreement will likely be adopted by the court.

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Benefits of a postnuptial agreement

There are several benefits to signing a postnuptial agreement, making it the right choice for you and your spouse or civil partner:

  • Clarity

A postnuptial agreement can provide clarity, for example making it clear that a specific asset belongs to one party and will not be shared.

  • Certainty

The agreement can provide certainty between spouses or civil partners, allowing them to agree on how finances will be divided in the event of separation.

  • Transparency

Providing full financial disclosure of assets and income (through the process of entering into the agreement)  means both spouses or civil partners  know and understand the value of one another’s assets.

  • Protection of assets and family members

Inherited assets and family heirlooms are just some assets that can be protected by a postnuptial agreement, and family members, like children from previous relationships, can have their inheritance protected, too.

  • Potential money saving

Going through a divorce can be costly, and although a postnuptial agreement means paying legal fees, these would be considerably less than the cost of arguing over the division of your assets in the event of divorce.

Signing an agreement does not mean you believe the marriage or civil partnership will end, and while discussing finances can be hard, it can strengthen a relationship through clear communication and understanding, and potentially save time and expense down the line.

How Ward Hadaway can help with your postnuptial agreement

Neither a prenuptial nor postnuptial agreement is better than the other. Which agreement you choose to enter into depends on personal timing and circumstances.

At Ward Hadaway, we have an expert team of postnuptial agreement solicitors who are on hand to guide you through protecting your assets after marriage or entering a civil partnership.

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    Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.

    This page may contain links that direct you to third party websites. We have no control over and are not responsible for the content, use by you or availability of those third party websites, for any products or services you buy through those sites or for the treatment of any personal information you provide to the third party.

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