Types of marriage contracts are legal agreements that outline financial and legal terms before, during, or after marriage. As the name implies, a marriage contract is a contract between spouses. While marriages themselves are legally binding contracts between two people, marriage contracts alter the typical terms. Both parties must agree and willingly sign the contract for them to be considered legally binding. In many cases, both spouses should also have a lawyer representing their interests.

Marriage contracts matter because they allow couples to define what they want for themselves outside of typical marriage standards. For example, in a standard marriage, property accrued during the relationship is often considered jointly owned. Even if only one spouse's name is on the title of a house, it's likely the other spouse also has a legal claim to it if it was bought while they were married. However, with the various marriage contracts that exist, this can be altered to suit the wants and needs of the couple.

Some contracts occur before marrying. Others occur during the legal relationship, while others still guide in the event of a separation. Some address strictly financial decisions, while others may delve into child support and custody. Ultimately, marriage contracts are agreements between partners to ensure mutual understanding, no matter what happens.

Neptune helps explain key concepts to prepare for a prenup or postnup to get the conversation started with your partner.

1. Prenuptial Agreements

Prenuptial agreements, commonly referred to colloquially as prenups, are agreements signed and agreed to before tying the knot. They determine the financial roadmap for the couple, including how to treat premarital assets, how finances are handled during the relationship, and also some financial guidelines to follow. They can also dictate financial decisions in the event of a separation or death of one of the spouses. 

In fact, a common use for prenups is ensuring certain assets go to a child from a previous marriage instead of being treated as community property that the widowed spouse retains.

Everyone can benefit from a prenup, though those with more assets may benefit more from them. They can safeguard several financial interests and benefit both parties. For example, a prenup may include guidelines for a working spouse to fund a stay-at-home spouse's retirement fund regularly. They can also help keep one spouse out of another's business finances.

Contrary to popular belief, prenups aren't just to plan for the relationship's end, nor do they contribute to the rate of separation. Rather, they act as a way to get both parties on the same financial page before legally tying themselves to each other. They require both parties to disclose the entirety of their financial status while also engaging in open and honest conversations about financial expectations moving forward.

While largely considered legally binding, there are some reasons a prenup might be overturned in court. Judges generally don't like enforcing prenups that are obviously one-sided or if they think one party only signed after coercion. Judges also won't enforce decisions about child support and custody or about lifestyle choices.

2. Postnuptial Agreements

Sometimes, it makes sense to alter the legal agreements between a couple during their relationship. Postnuptial agreements (postnups) operate like a prenup but occur after the wedding. They can be useful if a couple has never considered a prenup but has decided they want the guidance of one afterward. They can also be a great choice if your financial situation has changed significantly enough during the relationship to warrant rediscussing how assets should be considered.

For example, if your business suddenly took off and you now make far more money than you ever thought possible, you might want to add some provisions to your relationship, such as stating that all business interests (and debts and liabilities) are solely yours. This ensures your business stays your own while also leaving your spouse out of the liabilities that could come into play later on.

Sometimes, a spouse inherits property or assets that they want to remain solely in their name. A postnup can help with this as well, making it key if you want to make sure a family home stays in your family and eventually passes to your child.

A transmutation agreement is one type of postnup that allows for the changing of ownership of a property. For example, a house could be transferred into just one spouse's name. Or, if the property is already in one spouse's name, it could be transitioned into community property.

3. Separation Agreements

Although you probably never plan on separation, it can happen for any number of reasons. The process of a legal dissolution can take months or even years in some cases. A separation agreement provides a contract between both parties to define how you will treat the relationship and your finances moving forward.

Separation agreements typically outline far more than finances. They can also include a temporary child custody and support schedule, define responsibilities, and determine who remains in the home and who moves out.

Collaborative, Comprehensive Marriage Contracts With Neptune

Marriage contracts are a great way to add clarity to any relationship by facilitating open communication and ensuring both parties are on the same page.  A well-written prenup or postnup can strengthen your relationship by providing a collaborative way to work through your shared and separate finances. A carefully crafted separation agreement can provide amicable terms that help minimize court involvement as you decide how to move forward with the rest of your lives.

Neptune helps you plan for forever, providing key information you may need to navigate your relationship and ensure mutual understanding and agreement. Let us help you match with a local vetted attorney prepared to help draft, finalize and notarize your prenup or postnup so you can go back to focusing on your loved one. Start by seeing if a prenup or postnup is right for you with our online quizzes.