Whether you’re beginning a new relationship or separating from a long-term partner, financial clarity and security are essential. One of the most effective legal tools available to individuals and couples in Australia is a Binding Financial Agreement (BFA). Understanding the purpose, process, and binding financial agreement cost can help you make an informed decision about your future.
In this article, we’ll explain what a Binding Financial Agreement is, when you might need one, how it can protect your future — and what to know about binding financial agreement cost, whether you’re starting fresh or moving on.
What is a BFA?
In essence, a Binding Financial Agreement (BFA) is a legally enforceable document made under the Family Law Act that allows couples to determine how assets, liabilities, and financial resources will be divided in the event of a separation or divorce.
Unlike Consent Orders, BFAs do not require court approval. This means they can be tailored specifically to your unique situation and finalised more privately and efficiently.
BFAs can be entered into:
- Before a relationship begins (commonly known as a prenup or financial agreement before marriage or cohabitation)
- During a relationship
- After separation or divorce
Why Would You Need a BFA?
If You’re Starting a New Relationship
You may want a BFA if:
- You have significant assets, savings, or property you wish to protect
- You’ve previously been through a separation or divorce and want more certainty this time
- One of you has children from a previous relationship
- You’re entering into the relationship with unequal financial positions
In this case, a BFA sets clear expectations and outlines how assets would be managed or divided if the relationship ends. It’s not about planning for failure; it’s about ensuring that both people feel safe, respected, and understood.
If You’re Separating or Divorcing
A BFA can help you:
- Avoid going to court and the costs and stress that come with it
- Protect your share of assets
- Finalise your financial affairs more quickly
- Move forward with clarity and confidence
BFAs are especially helpful for amicable separations where both parties agree on how to divide property and finances and want to formalise it privately.
How Does a Binding Financial Agreement Work?
A Binding Financial Agreement must meet several legal requirements to be valid:
- Independent legal advice: Both parties must receive independent legal advice from separate lawyers before signing.
- Full disclosure: Both parties must disclose all assets, liabilities, and financial resources.
- Fair and lawful terms: The agreement must comply with the Family Law Act.
- Properly drafted and executed: It should be written by a qualified legal professional with a deep understanding of family law.
At Martens Legal, we help our clients by:
- Listening to your goals and concerns
- Creating a tailored agreement to protect your interests
- Making the process clear and transparent from start to finish
- Offering fixed-fee pricing to give you peace of mind about costs
How Much Does a Binding Financial Agreement Cost?
As a general guide, the cost of a Binding Financial Agreement can vary significantly depending on the complexity of your situation. For a standard agreement, you can expect prices to start from around $5,500.
However, if your circumstances involve financial entities such as trusts, companies, or unique arrangements, the cost can increase to anywhere between $15,000 and $20,000.
This is because more complex agreements require additional time, legal expertise, and strategic planning to ensure your interests are properly protected.
What Can a Binding Financial Agreement Include?
Your BFA can cover a wide range of financial matters, such as:
- Division of property, including homes, cars, and investments
- Treatment of superannuation and savings
- Spousal maintenance arrangements
- Debts and liabilities
- Financial support
You can also include clauses that allow the agreement to be reviewed or updated if your circumstances change, such as having children or acquiring new assets.
Benefits of a Binding Financial Agreement
- Protection: Safeguard your individual assets and future financial stability.
- Clarity: Know exactly where you stand if your relationship ends.
- Avoids conflict: Reduce the chance of disputes or costly legal battles later on.
- Privacy: Keep your personal and financial matters out of the courtroom.
- Efficiency: Save time and money by resolving matters outside of court.
Common Myths About Binding Financial Agreements
Myth: Only the wealthy need a BFA.
Reality: Anyone with assets, savings, property, or children from previous relationships can benefit from having one.
Myth: A BFA means I don’t trust my partner.
Reality: It’s not about distrust. It’s about planning ahead and removing uncertainty, just like having insurance or a Will.
Myth: We’re getting along now, so we don’t need one.
Reality: That may be true today, but things can change. A BFA helps both parties protect themselves from future misunderstandings.
Is a Binding Financial Agreement Right for Me?
If you value transparency, protection, and peace of mind, a BFA may be the right option for you. Whether you’re blending families, entering a new chapter, or finalising a separation, a BFA gives you the structure and security to move forward with confidence.
At Martens Legal, we specialise in amicable legal solutions for people navigating life’s big transitions. Our approach is clear, caring, and strategic. We help you understand your options so you can make empowered decisions for your future.
FAQs About Binding Financial Agreements
Q: Can we both use the same lawyer for a BFA?
A: No. In fact, Australian law requires each party to receive independent legal advice from separate lawyers for the agreement to be legally binding.
Q: How much does a Binding Financial Agreement cost?
A: Costs vary depending on the complexity of your situation. However, at Martens Legal, we offer fixed-fee pricing and will provide a clear quote upfront.
Q: Can a BFA be overturned?
A: It’s possible, but only under specific circumstances such as fraud, duress, or if the agreement becomes impractical due to significant life changes. Therefore, proper legal drafting helps ensure your BFA holds up over time.
Q: What’s the difference between a BFA and Consent Orders?
A: Consent Orders are approved by the court, while BFAs are private agreements. Both are legally enforceable, but BFAs offer more flexibility and discretion.
Q: Can I update my BFA later?
A: Yes. BFAs can include review clauses or be amended if both parties agree. This ensures the agreement stays relevant as your life circumstances change.
Ready to Protect Your Future?
If you’re in a new relationship or preparing to finalise a separation, don’t leave your financial future to chance. A Binding Financial Agreement gives you clarity, security, and peace of mind.
Let’s make a plan that works for you.
Contact Martens Legal today for a free discovery call or to get started with a tailored quote.
