What are Binding Financial Agreements? (Pre Nups)
In Australia a pre nup is called a “Binding Financial Agreement”. The amendments to the Family Law Act 1975 extend Binding Financial Agreements to those in a de facto and same sex relationships.
A Pre Nup or Binding Financial Agreement:
- Is like an insurance policy for your house. You hope you never need to use it, but if something goes wrong you have the security of your insurance policy to prevent you from having to start from scratch.
- Gives certainty to you and your spouse/partner about what will happen to your assets and finances if you separate in the future.
- Protects your business, company(s) and Trust(s) from a claim from your ex-partner.
- Protects you from ending up in court.
Those embarking upon a second relationship, especially those blending families with adult children should consider a Binding Financial Agreement in conjunction with an Estate Plan.