No one enters a relationship intending for it to end badly – and very few people think it will ever happen to them. With that said, we believe it’s always best to hope for the best and plan for the worst.
That’s what prenuptial agreements (otherwise known as binding financial agreements) are all about.
How do prenups work in Australia?
Prenups must be in writing and signed by both parties entering the agreement and their lawyers. Both signees must also seek separate, independent legal advice to ensure that they understand the agreement.
What are the benefits of prenups in Australia?
Prenups or binding financial agreements are legally binding documents that set out how the assets of each person in a relationship or marriage will be divided in the event of a split or divorce. They can be entered into before, during or after a relationship and can have several benefits such as:
- Certainty: prenups provide certainty to both parties around what they will receive if the marriage or relationship breaks down.
- Security: those with valuable assets can feel secure when entering into a relationship or marriage knowing their wealth is protected.
- Low stress, low cost: court disputes over the division of assets after a break up can be costly and stressful. Prenups eliminate the need for these disputes by setting out binding terms in advance.
- Keeping matters private: a prenup can be created in private and only your partner, their lawyer, you and your lawyer need to know its contents.
While getting a prenup may seem pessimistic or overly cautious, the reality is that hundreds of Aussies benefit from them every year – and a prenup can help couples move past financial concerns to focus on their relationship.
What are the limitations of prenups in Australia?
Prenups are legal documents that must be adhered to by both parties in the vast majority of circumstances. However, there are some unique situations where they can be set aside by the court, such as:
- If the agreement was obtained under duress.
- There is evidence of non-disclosure by either party.
- The agreement is simply not fair to either party.
- If either party did not receive independent legal advice before signing.
- If the agreement is incorrectly prepared.
- Either partner’s circumstances change in a way that means the agreement will cause hardship.
Prenups can also unfairly favour one party and by signing you may waive legal rights that you would have otherwise enjoyed. Never sign a prenup if you don’t understand its contents and how they may affect you.
Getting a prenup in Victoria
If you would like to draft a prenup or have been asked to sign one by your partner, your first call should be to an experienced family lawyer. Our lawyers here at Testart Family Lawyers have years of experience helping people just like you with prenups, or binding financial agreements, and can provide clear and honest advice to help you make an informed decision.
Get in touch today to book a consultation and gain peace of mind.