Binding Financial Agreement Before Marriage in Australia

Binding Financial Agreement Before Marriage in Australia

A Binding Financial Agreement before marriage is commonly referred to as a “prenup” or prenuptial agreement. In Australia, however, the correct legal term is a Binding Financial Agreement, or BFA.

For couples planning to marry, a BFA can provide certainty about how property, financial resources and liabilities will be dealt with if the relationship later breaks down. It allows both parties to discuss financial expectations before marriage and record their agreement in a formal legal document.

For lawyers and family law practitioners, having a carefully drafted precedent can assist in preparing a clear, structured and compliant agreement for clients entering marriage.

What is a Binding Financial Agreement before marriage?

A Binding Financial Agreement before marriage is an agreement made by parties who intend to marry. It sets out how their financial affairs will be managed if the marriage comes to an end.

These agreements are commonly used where one or both parties have existing assets, business interests, family wealth, inheritances, property, investments or children from a previous relationship.

A BFA may deal with matters such as:

  • property owned before the marriage;
  • jointly acquired property;
  • financial resources;
  • liabilities and debts;
  • business or investment interests;
  • asset protection arrangements;
  • financial arrangements if the relationship breaks down.

Why couples enter into a BFA before marriage

A Binding Financial Agreement can help couples approach marriage with greater financial clarity. While discussing a financial agreement before marriage can sometimes feel uncomfortable, it can also reduce uncertainty and help avoid future disputes.

A BFA before marriage may be useful where:

  • one party owns significant assets before the marriage;
  • one or both parties have children from a previous relationship;
  • family wealth or inheritances need to be protected;
  • a party owns a business or professional practice;
  • there are investment properties or other financial assets;
  • the parties want to agree in advance how property will be divided.

Is a BFA the same as a prenup?

In everyday language, many people refer to a Binding Financial Agreement before marriage as a prenup. In Australia, the formal legal term is Binding Financial Agreement.

A prenup is not a separate type of agreement under Australian law. It is simply the commonly used name for a financial agreement entered into before marriage.

Independent legal advice is essential

For a Binding Financial Agreement to be binding, each party must receive independent legal advice before signing. The advice must be given by a legal practitioner, and the agreement must include the required legal advice certificates.

This is one of the reasons it is important for practitioners to use a carefully prepared precedent that includes the appropriate structure and independent legal advice provisions.

Download the Binding Financial Agreement Before Marriage precedent

Precedents Online offers a professionally drafted Binding Financial Agreement Before Marriage precedent for Australian legal practitioners.

This precedent is drafted for use under section 90B of the Family Law Act 1975 and includes provisions dealing with property, financial resources, liabilities and independent legal advice.

The document is supplied as a fully editable Microsoft Word document and includes practical drafting guidance so it can be tailored to suit the client’s circumstances.

Key features

  • Lawyer-drafted Binding Financial Agreement precedent
  • Suitable for parties intending to marry
  • Drafted for use under section 90B of the Family Law Act 1975
  • Includes independent legal advice provisions
  • Fully editable Microsoft Word document
  • Practical drafting guidance included
  • Instant download after purchase

Who is this precedent suitable for?

This precedent is suitable for Australian family law practitioners and legal professionals preparing a Binding Financial Agreement for clients before marriage.

It may assist where clients want to protect existing assets, record financial arrangements, manage expectations and reduce the risk of future disputes.

Download Binding Financial Agreement Married.