We’ve all heard of the multi-million dollar Hollywood Prenups. But you don’t need to be Brad Pitt or Angelina Jolie to get one. Regular Aussie couples can get them too.
In Australia, we call them Binding Financial Agreements (BFA). They can protect a range of assets including property, money, shares, superannuation and even pets. Most people know that you can enter into a prenup BEFORE the commencement of a relationship.
However, you can also enter into a prenup DURING or AFTER a relationship ends.
A prenup could be useful for a whole range of reasons.
It could be your second marriage and you have assets from your first marriage that you want to keep to pass to your children. A prenup can ensure that your assets don’t get ‘mixed’ which is what will normally happen when you enter into a marriage or defacto relationship.
Protecting Initial Contributions
When the relationship begins there is often a situation where one party has much more property or assets than the other. To avoid any hostility or uncertainty if the relationship does fail you can write up a prenup agreement before entering into the relationship. This will save a huge amount on future legal fees if the matter ends up in court.
A Prenup Is like an Insurance Policy
You have been living with your partner for a few years and haven’t really considered your financial situations. To seek clarity as to what will happen if you do separate at some stage, and to avoid hefty legal fees, you could draft a prenup as a precaution whilst you are still on good terms with your partner.
While a prenup can provide a level of financial security, it’s important to remember that they can be challenged and a court can set them aside.
Prenups can provide a guide as to what the parties had originally agreed upon, nevertheless, courts may set them aside deeming them to be unfair or unreasonable towards a particular party.
It is clear that prenups are not for everyone and that there is still some uncertainty and confusion about how they work.
There are also strict legal requirements about how prenups are drawn up so a couple should each seek independent advice before going down this path.
Principal of Justice Family Lawyers, Hayder specialises in complex parenting and property family law matters. He is based in Sydney and holds a Bachelor of Law and Bachelor of Communications from UTS.