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Protecting business interests with a postnup

On Behalf of | Aug 20, 2021 | Property Division

Many married couples in Illinois find that financial issues become a source of contention in their relationships. One way of dealing with this problem is to sign a postnuptial agreement. A postnuptial agreement is similar, in some ways, to a prenuptial agreement in that it outlines the way a married couple will split up their assets should the marriage fail.

Why use a postnup?

Prenuptial and postnuptial agreements are sometimes criticized for being cold and unromantic. These critics say that it’s a bad idea to plan for the worst. However, there are times when a married couple may decide that a postnup can work for them. It can make both parties feel like if the worst happens, they will both be protected by a fair settlement.

One reason that people may decide to utilize a postnup is to protect business interests in divorce. If one partner in the relationship has built a business from nothing, both parties may agree that they should be entitled to keep that asset. In this example, it’s clear why a postnup can be a good idea. When writing a post nuptial agreement, people are still together and committed to the partnership. They are more likely to be fair and equitable in that circumstance as opposed to a situation where they’ve been fighting and they’re ready to call it quits.

Creating a postnup

Like all contracts, postnups must show consideration for both parties. This kind of contract must be in writing. Postnups also must be entered into freely, so if there’s evidence of intimidation or coercion, the court will not uphold the contract.

Postnups can be a useful way of ironing out financial disagreements. That’s especially true for couples who have a high net worth or are entrepreneurs. A postnup is one way to fairly manage the financial issues that can arise in a marriage.