What is a prenuptial agreement (“prenup”)?
A prenup is known as a Binding Financial Agreement under Australian Law. It is a legally binding document used to protect assets of each party in a relationship. This document will often detail the assets and liabilities each party owns, and how they are to be distributed should the relationship break down. The intention of such agreement is to preclude the Family Court from interfering with the division of assets, in the event of a separation.
Who can get a prenup, and when?
Any two parties who are in (or entering into) a marriage or de facto relationship can sign a prenup, provided they freely consent to the agreement. The most common time a couple will enter into a prenup is before marriage, although it can be entered into at any point during or after a relationship.
Why would I get a prenup?
There are many advantages to entering into a binding financial agreement, the most common of which include :
- Certainty and security
- Allows you to plan for ‘the worst’ rationally and without emotions involved
- Potential tax benefits
- Enables privacy where court proceedings would not
- It is time and cost-effective compared with the court process
Can we just create our own prenup?
There are strict technical requirements to ensure a prenuptial agreement is legally binding. Each party to the agreement must receive independent legal advice. The lawyers for each party are also required to be present at the time the agreement is signed.
An experienced family lawyer should prepare this agreement on your behalf to ensure that it has legal standing. If you are still unsure or have any other questions, give our family law team a call today.