Family Law FAQS: What is a Financial Agreement in Family Law?

Clarity Lawyers Australia Blog Binding Financial Agreements

Welcome back to our Family Law FAQs series at Clarity Lawyers.

Today, we’re tackling a question we often hear: “What is a financial agreement?”

Known as binding financial agreements (BFAs) in Australian family law, these legally binding documents play a crucial role in outlining financial arrangements between partners.

Whether you’re contemplating marriage, living in a de facto relationship, or navigating changes post-relationship, understanding BFAs is key to ensuring clarity and security for all involved.


What is a Financial Agreement?

A financial agreement under the Family Law Act is a written agreement between couples which outlines the division and management of financial arrangements and property if the relationship ends. It’s vital that each party obtain independent legal advice to ensure the agreement is fair and legally binding.


Types of Financial Agreements

  1. Pre-nuptial Agreements (Pre-nups)

    These are binding financial agreements made before marriage, detailing how property and assets will be managed and divided if the relationship ends.

  1. Post-nuptial Agreements (Post-nups)

    Similar to pre-nups, these agreements are made after a couple is married and outline how assets and finances are to be handled.

  1. Cohabitation Agreements for De Facto Couples

    For those in a de facto relationship, these agreements provide clarity on financial arrangements and property settlement should the relationship dissolve.

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Property Settlement Matters

Property settlements can become contentious, but a binding financial agreement can define the division of property and finances, reducing disputes and the need for court intervention. Both married couples and de facto partners can benefit from clear agreements.


Spousal Maintenance and Child Support

Financial agreements can include terms for spousal maintenance and child support, ensuring all financial support obligations are understood. Independent legal advice is crucial to ensure these sections meet legal standards and fairness.


Frequently Asked Questions (FAQs)

Can a financial agreement be overturned?

Yes, but only if there was a major change in circumstances affecting children, or if someone did not receive independent legal advice.


How do I ensure my financial agreement is legally binding?

Independent legal advice must be received by all parties, and the agreement must comply with all legal requirements. If there have been major changes or someone has been left extremely disadvantaged, an agreement could potentially be overturned.


What are the benefits of having a financial agreement?

These agreements provide clarity and help avoid lengthy disputes in court, safeguarding both assets and emotional well-being.


Can financial agreements cover future assets or inheritance?

Yes, BFAs can include future assets and inheritance, but it’s important to clearly detail this in the agreement. Nothing should ever be assumed when it comes to financial agreement family law, and every aspect of the situation needs to be considered. Another reason why each party needs to have received independent legal advice before an agreement can be made.

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How We Can Help

At Clarity Lawyers, we are adept at drafting, reviewing, and providing legal advice on all types of financial agreements. Whether you are in a de facto or marital relationship, or your agreement pertains to children and parenting matters, or financial and property matters, our expert team ensures that your agreement reflects your interests and adheres to all legal requirements.

Financial agreements are a fundamental aspect of family law that provide security and peace of mind for couples in any type of partnership. If you’re considering a BFA, legal advice is indispensable. Contact Clarity Lawyers for a consultation to protect your financial future and to navigate the intricacies of binding financial agreements effectively.

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Rli Samantha@2x
Samantha Miller

Samantha has been a lawyer since 2001 having followed in the steps of her father, grandfather, great-grandfather and great-great-grandfather. No one can say she didn’t know what she was getting into!

Initially admitted in 2001 as a solicitor in NSW and Australia, Samantha moved to the UK where she was admitted as a solicitor in England and Wales in 2002. After working in several different areas of the law in large London firms, she determined that family law was her calling and hasn’t looked back.


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