You’ve probably heard about a prenuptial agreement, but how about a postnuptial one? In Australia, over the last few years, the postnuptial agreement is gaining popularity among married couples and couples in de facto relationships. These couples sign such agreements to protect their individual assets during or after marriage. If you are recently married, and you are not quite familiar with what a postnuptial agreement is, then here is what you should know:
What is a Postnuptial Agreement?
In Australia, a postnuptial agreement is referred to as a binding financial agreement. It falls under the Family Law Act 1975 Section 90C, which also includes prenuptial, separation, and divorce agreements.
Postnuptial agreement is almost the same as a prenuptial agreement, only it is done after marriage. It allows married couples or partners in a de facto relationship to enter a financial settlement. It determines how properties and spousal maintenance are to be dealt with in case the couple wants to get divorced or separated. These terms also apply in the event of death.
Who Should Get this Binding Financial Agreement?
A postnuptial agreement is not necessary for every married couple. Typically, lawyers or legal advisers recommend couples to get this agreement only if they possess high-value assets or an inheritance. However, anyone who has earned a high amount of earnings in the course of the marriage may choose to get a binding financial agreement as well.
Here are people who should get a binding financial agreement:
- A married couple who have individually-owned assets and hadn’t found the time to sign a prenuptial agreement
- A married couple with a spouse who is part of a family business and wishes to protect ownership and assets
- An individual entering their second or third marriage with children from previous relationships or marriages
You should know that the moment you get married, many of your assets acquired during your marriage become marital property. Therefore, if you want to secure some of your personal assets in the event of divorce or separation, you should determine which assets you want to exclude as marital property in your postnuptial agreement.
When Should You Get this Agreement?
Some couples only sign a binding financial agreement after marriage because they see its procedure as an awkward and overwrought process that may or may not affect their relationship. Others enter into one to update their prenuptial agreement.
No matter how taboo it is to talk about, finance can significantly affect one’s marriage. That is why some couples make sure to be smart with their decisions. Although it is advised to get an agreement right after marriage, married couples can choose to have it later on, especially when:
- There has been a drastic change in a couple’s financial situation
- A spouse inherited a large amount of money during the marriage
- A spouse received a valuable heirloom during the marriage
- A couple is planning a divorce or separation
This binding financial agreement helps each party protect their valuable personal assets in the event of divorce, separation, and death. Such valuable assets include but are not limited to:
- Insurance and retirement coverage
- Stock options earned during the marriage
- Real estate purchases during the marriage
- Future inheritances and earnings
When is it Legal?
Since the postnuptial agreement falls under Australia’s Family Law Act, this must follow specific standards and procedures before it is deemed legal.
A binding financial agreement is legal only if:
- It is written
- Both parties have signed it
- Each party received independent legal advice about their rights and the advantages and disadvantages of the agreement
- The legal adviser gave a signed statement of their advice to each party
- Each party received a copy of the other’s signed statement
- The court does not terminate or set aside the agreement
It is not surprising to know that many marriages or long-term relationships fail due to finance-related issues. Getting a postnuptial agreement helps each party lessen the tension in the event they decide to get divorced or separated. While some people may think that doing this may affect relationships and trust between partners, know that this agreement is merely an insurance, and helps protect both of you in the long run.
If you recently got married and are looking for a family lawyer in Rozelle, get in touch with us today – our highly professional and trusted lawyers will gladly help you settle any of your legal matters.