Divorces can be a complicated and costly affair, with many spouses receiving the short end of the stick when dividing financial assets after a divorce. This usually happens when one spouse has significantly more assets than the other—which many would think to be an unfair scenario.
Australia’s “Prenup”: the BFA
To prepare for such circumstances, many family lawyers recommend getting a binding contract that stipulates how financial assets will be divided in the event of a breakdown in a marriage or a de facto relationship. While many countries refer to this contract as the Prenuptial Agreement, Australian law refers to this contract as the Binding Financial Agreement (BFA).
A BFA is a way for married or de facto couples to settle financial matters should a marriage break down later. Couples can get this agreement at any time during their relationship; In fact, couples commonly get one before entering into a marriage, but they can just as easily get it while they are already married! It can also be secured upon the breakdown of a relationship, which bodes well for both parties as it does away with complex and costly litigation.
While it makes sense from a legal standpoint, there are many reasons why many couples are not open to the idea of getting a BFA.
Disadvantages of Getting a BFA
For one, starting a relationship with a binding contract can bring forth a sense of mistrust, since it is written in anticipation of a dissolved marriage or de facto relationship. Some couples, especially those who are in the “honeymoon” stage of their relationship, may not relish the prospect of having to consider that their relationship might end prematurely.
Given the disparities in income, a low or non-wage-earning spouse may end up being severely disadvantaged if the BFA limits the amount of spousal support that they may be entitled to receive. They could end up unable to sustain the lifestyle they have been accustomed to, which may result in a significantly lower standard of living.
Advantages of Getting a BFA
That being said, there is also a reason why the BFA exists as a legal solution. This agreement is not only limited to dividing assets between the spouses; it can also ensure that your children’s inheritance rights are preserved even after the other spouse produces other heirs in another marriage.
If one spouse ends up racking more debt, it can protect the other spouse from assuming any obligation and live debt-free. Similarly, spouses who run their own business independently from their partner can retain ownership and not worry about relinquishing control or divvying those assets.
If you have to sacrifice a successful career for your marriage, it can also ensure that you are compensated for it if it breaks down prematurely.
A BFA doesn’t always have to be a lopsided agreement that favours one side over the other. It can even spare a couple from going through an arduous litigation process that can happen after a divorce.
Ideally, it should be crafted with mutual trust between two spouses. However, to be safe, always ask the opinion of a family solicitor, like Springfield Legals, before signing a BFA. This way, you can ensure that your rights are protected even if your marriage breaks down!
Are you looking for family lawyers in Ipswich to help you with the intricacies of your BFA? At Springfield Legals, we handle various claims and cases, ranging from unfair dismissal and on to divorce and separation! Connect with us and make an appointment with us today to learn more!