Do I Need a Prenup?

What is a “prenup”? 

A prenuptial agreement, or “prenup” for short, is a legal agreement between two individuals who are planning to marry or enter into a de facto relationship, most commonly referred to as binding financial agreement or a BFA. 

The main purpose of a BFA is to establish how assets, debts, and other financial resources will be handled in the event of a separation or divorce. 

Why would I need a BFA? 

In Australia, BFA’s are recognised by law, and they can be useful in a variety of situations. Here are some reasons why you might consider signing a BFA in Australia:

1. Protecting assets: If you have significant assets before becoming de facto or before getting married, a BFA can help protect those assets in the event of separation. Without a BFA, those assets could be divided between you and your spouse in accordance with the Family Law Act 4 step process.
2. Clarifying financial expectations: A BFA can help to clarify each partner’s financial expectations. This can include issues such as how expenses will be shared and what each party will retain in the event of separation. 
3. Avoiding lengthy legal disputes: By establishing clear guidelines for how assets and debts will be divided in the event of a separation, a BFA can help avoid lengthy legal disputes and save both parties time and money.
4. Protecting family businesses: If you own a family business, a BFA can help to protect that business from being divided up in the event of a separation.
5. Protecting against any future claim of spousal maintenance: if you earn more than your partner, it is a good idea to include provisions in relation to spousal maintenance within the BFA. 

What if things change after we sign the BFA? 

“What if my partner and I signed a BFA and now have changed our mind because we have a child together?” 

Relationship and expectations change, and BFA’s can be amended to reflect such changes, provided that you and your partner consent to the new agreement. 

If you and your partner consent, you do have the following options to amend the agreement reached between you both: 

1. Create a new BFA: You and your partner can enter into a new BFA that reflects the changed terms. This would involve creating a new legal document that sets out the agreed changes and having both parties sign it. Both parties would also need to obtain independent legal advice about the new agreement.
2. Vary the existing BFA: You can also vary an existing BFA if both parties agree to the changes. This would involve creating a document that sets out the agreed changes and having both parties sign it. Both parties would also need to obtain independent legal advice about the variation.
3. Terminate the existing BFA: If both parties agree, you can terminate an existing BFA and negotiate a new agreement. This would involve creating a new legal document that sets out the agreed terms and having both parties sign it. Both parties would also need to obtain independent legal advice about the new agreement.

It’s important to note that any changes to a BFA must comply with specific legal requirements in order to be valid and enforceable. Both parties must also obtain independent legal advice before making any changes to a BFA. It’s recommended to seek advice from a family law professional to ensure that any changes to your BFA are made correctly and comply with the legal requirements.

Legal Advice 

You should consult with a family lawyer to discuss whether a BFA is right for you, and to ensure that the agreement is reasonable and legally binding. An experienced family lawyer will be able to assess your individual circumstances and provide you with detailed advice in relation to the appropriate steps for your matter. 

If you’re considering a Prenup or Cohabitation Agreement, our Gold Coast family lawyers can help draft a legally sound agreement tailored to your circumstances.

Contact us today to schedule a free and confidential initial consultation with one of our experienced family lawyers. To book an appointment, you can:

• Call us on 07 5576 9999
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