Pre-Nups - To Sign or Not to Sign?
Updated: Jan 28, 2021
At FamilyLaw4Men our clients often ask us whether a Financial Agreement (commonly wrongly referred to as a "Pre-Nup") provides ‘insurance’ to protect their assets from their potential partners, upon separation or divorce.
This article aims to explain some of the important things that you need to know about Financial Agreements.
Difference Between ‘Prenups’ And ‘Binding Financial Agreement’
In movies or on the television, you may often hear couples signing a ‘prenup.’ A ‘prenup’ is an agreement that is entered into between parties contemplating a marriage.
In Australia, we do not have ‘prenups.’ Instead, we have Binding Financial Agreement (“BFA”). A BFA is a private contract entered in writing between couples of a de facto relationship or marriage that can be entered into at different stages of a de facto relationship or marriage.
The purpose of a BFA is to provide clarity as to what assets were brought into a relationship and more importantly how assets are to be divided upon separation.
Who Needs a BFA?
If you are in a relationship, whether de facto or in a marriage, you should consider a BFA.
If you bring into the relationship more $$ than your partner! This is often the case for most of our clients.
A BFA can be prepared at any stage of a de facto relationship or marriage. Having a BFA in place will not only save you the legal costs of going to court for a property settlement, but it will also provide you with the comfort of knowing how you and your former partner are able to move on.
What If I Do Not Have a BFA?
If you do not have a BFA in place when your relationship ends then you and your former partner will need to negotiate a property settlement.
If you cannot come to an agreement, then you will need the involvement of lawyers and this may possibly involve going to court for property settlement.
The court process is often long, costly and stressful.
Timing is everything when introducing a BFA!
Don’t introduce a BFA a few months prior to a marriage!
Best time to start talking about a BFA is before moving in with your partner and/or before asking her to marry you!
Are BFA’s 100% insurance for your assets?
Some of the scenarios where a BFA can be voidable include:
Where the terms of the BFA are not fair;
A party was not willing to enter the agreement;
A BFA was made solely to defraud a creditor, or;
Where the parties’ circumstances have changed significantly.
Costs for BFA
BFA’s are less costly than the amount of money and assets that they provide insurance for.
Without a BFA you expose yourself to high legal fees should your relationship fail
At Familylaw4men, we aim to protect our client’s best interests by guiding through the stages of preparing a BFA.
At Familylaw4men, we believe that every one deserves proper advice before entering into a BFA. Contact us today for assistance by email at firstname.lastname@example.org or telephone 0405240204.