Taking hold of our television screens at the moment is bachelor, Matty J, in his quest for love. Although The Bachelor is a prime example of people searching for that special someone, there are many who have already found “the one”.
In the course of commencing a relationship, we often forget about protecting our financial future and instead focus on growing as a couple. However, we must always remember to protect our assets the same way we protect our hearts.
Whilst in the midst of a fresh romance, new couples neglect the financial implications that can occur from entering into a relationship. Although it may not be a romantic conversation, it is a practical one to have with your partner and can serve to potentially protect your finances in the long term. The Family Law Act provides us with ways we can do this.
Under section 90B of the Family Law Act, parties can enter into a financial agreement before marriage (“Binding Financial Agreement”). This is often referred to by the American term of a pre-nup or pre-nuptial agreement. Not only are they available before marriage, but also during the period of marriage, and after separation.
A Binding Financial Agreement entered into before marriage deals with how the property or financial resources of either one or both of the spouses are to be dealt with, in the event of the breakdown of marriage.
What makes a financial agreement binding?
A Binding Financial Agreement is only enforceable if it is completed in accordance with section 90G of the Family Law Act. In order to be binding, the following must occur:
- The agreement must be signed by all parties;
- Each party must be provided with independent legal advice from a legal practitioner about their rights and effects of the agreement, including the advantages and disadvantages of entering the agreement;
- Each party must be provided with a signed statement from a lawyer confirming that that advice was provided; and
- A copy of that statement confirming that advice must be exchanged between the parties and/or their legal representatives.
Even if validly entered into, a court can set aside a Binding Financial Agreement in certain circumstances.
Entering into a relationship with an agreement that protects your financial future can ensure that you exit a relationship with the same assets you commenced the relationship with. It allows you to avoid unnecessary financial and emotional stress should your relationship come to an end. No one wants to think about the potential end when forming a relationship. However, this way of thinking can be of benefit to both parties and avoid unnecessary costs and emotional stress in the long run.
If you are interested in having a Binding Financial Agreement before, during or after marriage, feel free to get in contact with us on (08) 8210 5400 where our experienced family law solicitors can assist you in receiving the best result. After all, you can never know when your rose will become a thorn in your side….