In a De Facto Relationship? How Do You Protect Your Assets?

If you are not legally married but are in a relationship with another person and living with them on a genuine domestic basis, you are deemed by the court to be in a de facto relationship. For many people, the thought of protecting their assets is the last thing on their mind when entering into a de facto relationship. The thought that you may one day separate from your partner is often not even thought about.

Asset Protection Planning
Asset protection planning for individuals in a de facto relationship does not necessarily mean the couple is separating. Whatever the case, if you want to protect your assets and properties, it is best to develop a sound and effective asset protection strategy long before the possible need for it arises.

One of the most effective way to protect your assets is to draw up a binding financial agreement. A binding financial agreement can be entered at any time between the couple during the relationship and even during the separation. Similar to prenuptial agreements, this formalises how property, finances and other assets are to be divided, should the relationship break down. This agreement may also outline any other areas either person can or cannot make a claim about.

What are the legal requirements for a Binding Financial Agreement?
For a binding financial agreement to be legally binding, both parties must:

• Before signing the agreement, receive legal advice from separate solicitors about the advantages and disadvantages of making the agreement and the effect of the agreement on their rights;
• Receive a signed statement from their own lawyer confirming that the above advice has been given; and
• Receive a copy of a signed statement from the other party’s lawyer confirming that the other party has received the above advice.

The Advantages of Having a Binding Financial Agreement
The advantages of a binding financial agreement will depend on each individual relationship, however in general terms, some of the advantages can include:

• Having your own rules in place about the financial aspects of your relationship, made in happier times, often results in an agreement which is more likely to be considered by all parties to be fair and reasonable.
• It can provide comfort and certainty for a party who has already been through a long and protracted property settlement dispute.
• A binding financial agreement can protect pre-existing assets from claims by the other party to the relationship, which is particularly relevant and important when one party is in a superior financial position to the other. Often one party has accumulated assets prior to the commencement of a relationship without contribution from the other party and it is not to be unexpected that they wish to ensure those assets remain theirs upon separation. Further, a party could be likely to receive an inheritance from their family, the receipt of which they also wish to protect.
• Binding financial agreement can dictate how joint property can be acquired, financially maintained, and dealt with if separation occurs.
• Post separation property settlement negotiations are often more cost effective and timely if a binding financial agreement is in place.

If you would like to have a Binding Financial Agreement or Consent Orders drafted, Straits Lawyers are now offering online services at https://straits-lawyers.square.site/product/family-law-binding-financial-agreement-consultation-bfa-/5?cs=true.

Alternatively, you send us an email at info@straitslawyers.com or give us a call on 8410 9069 to arrange an appointment for an online interview.

Please note that this article does not constitute legal advice and Straits Lawyers will not be legally responsible for any actions you take based on this article.