E03: Money, Marriage & Postnups

Think prenuptial agreements are just about planning for the end? Think again. In this episode, Janet Boyle and guest, Robert Kipnis dive into the strategic world of postnuptial agreements and how they are actually used as powerful tools to save marriages rather than just end them. From managing financial friction and "spendthrift" behavior to navigating the aftermath of infidelity, we explore how putting expectations in writing can provide the security and clarity couples need to stay together.

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Disclaimer: This podcast is for educational and informational purposes only and does not constitute legal advice. No attorney-client relationship is formed by listening to this show. Every family’s situation is unique; please consult with a qualified legal professional regarding your specific case.

Connect with Family Law Solutions:

• Learn More: Visit our website for resources and guides.
• Join the Conversation: Follow us on LinkedIn, Facebook, and Instagram @familylawsolutionschicago for professional insights and industry resources.
• Work With Us: To schedule a consultation with our team, call 312-332-1344.

Disclaimer: This podcast is for educational and informational purposes only and does not constitute legal advice. No attorney-client relationship is formed by listening to this show. Every family’s situation is unique; please consult with a qualified legal professional regarding your specific case.

Transcript

SPEAKER_01 0:00

Postnuptial agreements are an interesting animal because everybody thinks of prenops. Okay, but post-nops can be very helpful to saving a marriage, can't they?

SPEAKER_00 0:11

Oh, absolutely. And that's what we use it for generally. This was just trying to cover their mistake, but unique, yeah. But I know it comes in the form a lot of times of infidelity. And then he promised not to stray again, or she won't stray again if certain things happen.

SPEAKER_01 0:29

I've also seen them where one party is overspending according to the other party. And so what they will do is allocate a certain dollar amount to the spendthrift, you know, in the postnup. So I'm going to, we're going to give you five million dollars and that's what you're going to get because you, you know, you don't know how to handle money, and I'm not going to keep having my um my estate, you know, diminish because you spend more than you should. Um so I've seen postnups that do things like that, um, you know, where they kind of divide up the marital estate in advance. Have you seen those?

SPEAKER_00 1:13

Yeah. I've done those. I've drafted those.

SPEAKER_01 1:17

Yeah. And it's it can be very helpful to getting people to stop fighting about money. And that's always a good point.

SPEAKER_00 1:25

A lot of times some of these litigants just want some money in their own name.

SPEAKER_01 1:28

Right.

SPEAKER_00 1:29

Just that little sense of security that in the event it happens, I'm secure.

SPEAKER_01 1:34

Right. Right. Or, you know, I mean, a little off the topic of prenups, but I had a case once where um the parties ended up getting divorced because she had a gambling problem. And it's so what he did is is is that he gave her like a million dollars and said, here's your share. And if you gamble it away, there isn't any more. And they actually put that in writing, which can be considered a valid post-nuptial agreement if it's, you know, if the other elements are made, even though they didn't go to a lawyer. And the judge that I was involved in actually ruled in my client's favor. And all the wife got was what she had gambled on.

SPEAKER_00 2:14

He upheld it.

SPEAKER_01 2:15

Yeah, yes. He upheld their agreement, which was basically just written by them over at the kitchen table, which I don't recommend, but it can be enforceable. So be careful what you sign because she had no idea that she's not a good idea.

SPEAKER_00 2:29

Be careful what you wish for.

SPEAKER_01 2:31

Exactly. Um, but prenups could be they can have so many purposes. They can protect the non-marital of each party, they can do the roadmap for how we're gonna you know do money, they can pr protect inheritances for children in the event of a death, they can um they can they can uh decide how residences are gonna be bought and and titled, can't they?

SPEAKER_00 2:57

For sure. They can also lay out how you're gonna reimburse the marital estate if the non-marital estate is making contributions to it. Yeah.

SPEAKER_01 3:07

So we've seen all these different ways that that prenuptial agreements can be used to uh protect the integrity and the respect of a marriage if they're done correctly in the beginning, and also how they can be used to save a marriage if necessary, because any fighting can be uh determined by looking at the roadmap of the prenup, or you can do a post-nuptial agreement to save a marriage. Is there anything else in these contracts that you think our audience should know?

SPEAKER_00 3:39

Well, just that you can do different things. You can do step-up provisions or length of the marriage, you can do step-up provisions when they their children are born, things of that nature.

SPEAKER_01 3:50

When you're saying step up, what you mean is let's say that I have all the money and um in the original prenup, uh, we've just agreed that I get to keep mine and you get to keep yours. But then we say once children are born, then we get an ex.

SPEAKER_00 4:05

We call it the Michael Jordan provisions because his second wife is provided for in that fashion. I think she's up to five or ten mil now, something to that effect.

SPEAKER_01 4:16

And I've seen those where it's if we're married for five years, you get this, if we're married for ten years, you get that, if we're married for twenty years, you get this. And I've seen them where if we're married more than twenty years or twenty-five years, that this prenuptial doesn't have to be.

SPEAKER_00 4:28

Null and void. Yeah. I just had one. I had a prenup contest where um it said if they're married for an excess of five years, the agreement's null and void. And he filed a week before their five-year anniversary.

SPEAKER_01 4:41

And I had the opposite where it said that it was going to end at 10 years, which I've don't ever understand the point of a prenup ending at five or ten years. It's too early in a marriage, but that's what they had. And he didn't think about filing, and she waited until 10 months and two weeks, and then she filed. So what's good for the goose?

SPEAKER_00 5:01

Yeah.

SPEAKER_01 5:02

So it's again those, those, those automatic ending of prenups, you have to be very careful of and make sure that it's a long enough period of time.

SPEAKER_00 5:10

Prenups much of the time have a provision in them that require an estate plan that mirrors the prenup. That way you don't have issues later with his previous children from another marriage.

SPEAKER_01 5:22

The question we get regularly is, well, why can't I just do a will or a trust? And the answer from my perspective to that is his wills and trusts are always modifiable.

SPEAKER_00 5:33

Revocable, sure. And you're not buying off the potential litigation and divorce court either.

SPEAKER_01 5:40

Right. So, I mean, just because somebody says, Why I'm the beneficiary of his trust, you and I just saw that one of our cases right now where as soon as the divorce was filed, they just revoked the beneficiary and put in a new beneficiary. Right. So having a being named in somebody's trust or being named in somebody's will is not going to do it.

SPEAKER_00 6:00

Right. That's why you need the provision in the prenup that says it's irrevocable. This whatever issue we're talking about is irrevocable. And the individual shall execute an irrevocable, either life insurance trust or some kind of uh irrevocable trust.

SPEAKER_01 6:18

Yeah. There is um there, there's there's always the danger whether you have a printu or not, of you know, there's so many assets that are acquired during the marriage that people argue they weren't contemplated.

SPEAKER_00 6:33

Right.

SPEAKER_01 6:34

Is that a thing?

SPEAKER_00 6:35

Not a defense. A bad deal is not a defense. Okay. But you hit it on the head and you have a 30-year marriage that could be huge asset accumulation that they didn't contemplate. Right. It's again, be careful what you wish for. You think you're buying security and you're just buying a bad deal.

SPEAKER_01 6:51

Yeah. And it goes back again to reviewing it every five years and trying to renegotiate it. Um, because, you know, or every two years or every seven years, or every time something changes. Right.

SPEAKER_00 7:02

A life event.

SPEAKER_01 7:02

Yeah, a life event, because that can be so um, you think everything's fine until it isn't. Um, and so often my clients don't see this coming. Okay. They don't know they're gonna get divorced. Um, and the other side had other ideas. I think you were telling a story earlier of somebody saying, I my youngest child just graduated from high school, and I've been hoping for this day for 18 years, and I'm now I'm done. I'm out of here.

SPEAKER_00 7:30

Yeah, we filed.

SPEAKER_01 7:31

And I don't know that the spouse ever saw that coming.

SPEAKER_00 7:35

Uh he didn't.

SPEAKER_01 7:36

Yeah. So I mean, one side can be laying in bed next to you thinking, you know, everything's fine, while the other one is sitting in their mind saying, I'm out of here in six months, a year, five years, whatever their time frame is, I'm not happy. And but I'm not gonna tell the other side. Do we see that?

SPEAKER_00 7:54

Oh, yeah. And that often.

SPEAKER_01 7:56

And so having the prenup, having the revisits to it, all of that can help protect you, but don't just trust.

SPEAKER_00 8:06

Right.

SPEAKER_01 8:07

Um, I hope that this has helped you understand a little bit more about prenups and post-nuptial agreements. Um, as I to I'm gonna continue to say, education and empowerment are two of the things that will get you where you need to go, both whether it's in a prenup, a divorce, any other family law issue. And it's only human nature to be out for yourself, to protect yourself. And we're just going to continue to boil it all down for you.