When people think about 'romance', they tend to imagine things like candlelight, flowers, oysters, champagne. Well, contrary to popular belief, I believe that Binding Financial Agreements should be bumped up the list. Whilst the 'branding' of BFAs may need a little marketing rework, they are, at their core, a deeply loving and romantic document.
It never ceases to amaze me how few people have frank, difficult and open discussions about finances prior to their marriage. The ability to have open dialogue about important issues such as relationship expectations and financial goals is a cornerstone of a healthy relationship. Whilst the prevailing sentiment seems to be that BFAs are unromantic, in my view, the discussions that pre-empt the preparation of a BFA are an opportunity to establish trust, understanding and intimacy.
When approached with sensitivity and care (and obviously: independent legal advice) couples gain a deeper understanding of what's important to their partner and the natural (and prudent) concerns that they may have about their financial security in the future.
BFAs are an opportunity for couples to work 'together' to agree on financial arrangements rather than leaving those decisions to the Court in the future. There are many reasons why more and more couples are turning to BFAs such as:
(1) People are getting married later in life, having accumulated wealth, inherited funds or grown their businesses.
(2) They have observed the statistics in relation to divorce in Australia and understand that the possibility of separation is let's say - 'not insignificant'.
(3) They wish to avoid the significant cost and stress of protracted Family Law litigation in the future.
(4) They want certainty and safeguards to protect themselves and the things that are uniquely important to them (their business, property, pets, collection of stamps/watches/handbags etc).
(5) They want to put arrangements in place while they are in a calm and unpressured environment, rather than having to make difficult decisions while feeling the emotional pain of a separation.
The feedback I hear time and time again is that BFAs are 'preparing for divorce' or in some way reflect a lack of commitment. I wholeheartedly disagree. The romance of the BFA is that each party enters into the relationship with peace of mind knowing that neither of them are in it for a 'windfall' - and similarly, that neither of them feel 'shackled' to the other out of fear that separating would be 'too expensive'.
Instead, each party is there because they have made an informed decision that they 'want' to be there, and in feeling protected, they can invest their full attention, love and devotion into the relationship.
For further information please contact:
Nicole Pozovsky, Associate
Phone: +61 2 9233 5544
Email: npp@swaab.com.au
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
