Marriage and relationships are about love, trust and shared goals. Marriage is also about life’s practical realities – like managing finances and protecting your assets.
For many couples, these conversations don’t stop after the wedding. Whether it’s due to a significant change in financial circumstances or wanting to create a clear plan for the future, a postnuptial agreement can be a practical and proactive solution.
In Australia, postnuptial agreements – also known as binding financial agreements – allow married couples or those in de facto relationships to outline how their assets and financial resources will be divided if the relationship ends. These agreements can also cover spousal maintenance and protect interests in a family business or blended family arrangements.
At Unified Lawyers we know navigating these legal agreements can be daunting. That’s why we’ve put together this guide to help you understand postnuptial agreements and how they can bring clarity, security and peace of mind to your financial future.
How Do Postnuptial Agreements Work?
A postnuptial agreement is more than just a piece of paper; it’s a carefully drafted legal document that provides clarity and security for couples.
These agreements can cover everything from how assets will be split to spousal maintenance.
In Australia, postnuptial agreements fall under section 90C of the Family Law Act 1975 (for married couples) and section 90UC (for de facto couples).
They are formally known as Binding Financial Agreements (BFAs).
To be legally binding, certain requirements must be met.
Both parties must fully and fairly disclose their financial circumstances, and independent legal advice must be obtained by each person before signing the agreement.
This ensures both parties understand their rights and the implications of the terms.
Under section 90G (or 90UJ for de facto relationships), a postnuptial agreement is binding if the agreement is in writing, signed by both parties, each party has received independent legal advice, the advising lawyers have each signed a statement confirming that advice was given, and the agreement has not been terminated or set aside by a court order.
The High Court case of Thorne v Kennedy shows the importance of fairness and transparency in creating binding financial agreements.
Agreements that don’t meet these standards can be challenged or be unenforceable.
When done properly, a postnuptial agreement can be a powerful tool to protect assets, avoid future disputes and give peace of mind for both parties.
Why Consider a Postnuptial Agreement
Couples create postnuptial agreements for various reasons, often tied to significant changes or milestones in their relationship or financial lives. Here are some of the most common situations where an agreement can be useful:
- Protecting significant assets: If one or both partners have acquired substantial wealth, property or business interests during the relationship, a postnuptial agreement ensures those assets are accounted for.
- Blended families: Postnuptial agreements can help couples with blended families outline how assets will be divided to protect the financial interests of children from previous relationships.
- Financial changes: Life doesn’t stay the same and major changes such as receiving an inheritance, selling a business or facing unexpected financial challenges can trigger the need for a legal agreement.
- Family businesses: For couples involved in a family business a postnuptial agreement can prevent disputes and clarify ownership and operational rights.
- Future clarity: These agreements reduce uncertainty, avoid future disputes and give couples peace of mind about how financial matters will be managed in the event of separation.
While it may seem scary to talk about finances, setting out clear terms can actually strengthen a relationship by building trust and transparency.
Pros and Cons of a Postnuptial Agreement
Like any legal agreement a postnuptial agreement has its advantages and disadvantages. Knowing both will help you decide if this type of agreement is for you.
Advantages of a Postnuptial Agreement
- Setting out how assets and financial resources will be managed reduces uncertainty and conflict providing financial clarity and security.
- Whether it’s property, investments or a family business a postnuptial agreement can help to protect significant assets.
- Postnuptial agreements can be flexible, addressing changes in financial circumstances that weren’t anticipated when the relationship started and allows.
- By agreeing to terms upfront couples can avoid long and costly legal battles in the event of a separation.
Disadvantages of a Postnuptial Agreement
- Talking about finances and planning for the worst-case scenario are difficult conversations and can be tough for some couples.
- If the agreement isn’t properly prepared—such as lack of full financial disclosure or independent legal advice—it may be unenforceable.
- A legally sound postnuptial agreement requires the involvement of experienced family lawyers which means an upfront expense.
While the benefits far outweigh the drawbacks it’s important to work with lawyers who can guide you through the process and ensure the agreement meets all legal requirements and your individual circumstances.
Postnuptial Agreements for De Facto Couples
Postnuptial agreements aren’t only for married couples.
If you’re in a de facto relationship, you can enter into a binding financial agreement under section 90UC of the Family Law Act 1975 at any time during your relationship.
These agreements work in much the same way as a postnuptial agreement for married couples.
They set out how assets, liabilities and financial resources will be divided if the relationship ends, and they can also address spousal maintenance.
De facto financial agreements are particularly common among older couples entering a new relationship after a previous marriage or relationship has ended.
They can also be useful where :
- One partner has moved into the other’s home
- There’s a significant difference in the assets each person brings to the relationship
- One or both partners have children from a previous relationship whose financial interests they want to protect
The same legal requirements apply, both parties must receive independent legal advice, provide full financial disclosure and enter into the agreement voluntarily for it to be enforceable.
Couples in same-sex relationships, whether married or de facto, have identical rights under the same BFA framework.
What’s in a Postnuptial Agreement?
A postnuptial agreement can cover a range of financial and practical matters specific to each couple. Some things that may be covered include:
- How marital property and separate property will be divided in the event of separation.
- What financial support will be provided if one partner needs it after the relationship ends.
- Who will be responsible for existing debts such as loans or credit cards.
- Protecting ownership in a family business or other ventures to avoid future disputes.
- Future financial arrangements such as life insurance policies, superannuation or future income from investments.
- Accounting for children from previous relationships especially in blended families to ensure their financial interests are protected.
But please note postnuptial agreements can’t cover child custody or child support as these are dealt with separately under Australian family law.
Superannuation and Postnuptial Agreements
Superannuation is often one of the largest financial assets a couple holds, sometimes second only to the family home.
A postnuptial agreement can specifically address how superannuation will be dealt with if the relationship ends.
Under the Family Law Act, super can be “split” between parties as part of a financial agreement.
This means a portion of one party’s super can be allocated to the other party either by way of a payment split (where the amount is transferred at the time of separation) or a flagging arrangement (where the super is flagged and cannot be dealt with until the flag is lifted by agreement or court order).
Including superannuation in your postnuptial agreement is especially important where :
- There is a significant difference between each partner’s super balances
- One partner has taken time out of work to care for children
- One or both partners are approaching retirement
- A partner has a self-managed superannuation fund (SMSF) with complex investments
Because super splitting involves its own set of regulations, it’s important to get advice from both a family lawyer and a financial adviser to make sure the terms in your agreement are practical and enforceable.
Postnuptial Agreements, Death and Estate Planning
Most people think of postnuptial agreements purely in the context of separation or divorce, but they can also play an important role when a spouse passes away.
A postnuptial agreement can set out what happens to shared assets and property in the event of one party’s death.
This is particularly relevant for couples in second or subsequent marriages who want to ensure that certain assets are preserved for children from a previous relationship rather than passing entirely to the surviving spouse.
However, it’s important to understand that a postnuptial agreement and a will serve different legal purposes and are governed by different legislation.
A BFA deals with the division of property under the Family Law Act, while a will deals with the distribution of your estate under state or territory succession law.
The two documents should work together and not contradict each other.
If you’re entering into a postnuptial agreement, it’s a good idea to review and update your will at the same time to make sure both documents reflect your current wishes and are consistent with each other.
Discussing this with both your family lawyer and your estate planning solicitor can help avoid complications for your family down the track.
Requirements for Postnuptial Agreements in Australia
For a postnuptial agreement to be enforceable in Australia it must meet the requirements of the Family Law Act. These safeguards are to ensure fairness and prevent disputes over the agreement’s validity.
The requirements are:
- Full financial disclosure: Both parties must provide a full and frank account of their financial circumstances including assets, liabilities and income.
- Independent legal advice: Each party must obtain advice from separate lawyers to ensure they understand the terms and implications of the agreement. A signed statement from each lawyer is also required.
- Voluntary agreement: The agreement must be entered into willingly, without pressure, duress, or unconscionable conduct.
- Compliance with legal formalities: The document must be in writing, signed by both parties and meet all the procedural requirements under the Family Law Act.
By meeting these requirements, you not only strengthen the agreement but also have peace of mind for both parties.
Can a Postnuptial Agreement be Challenged or Set Aside?
While a postnuptial agreement can give you clarity and security, it’s not immune to legal challenges.
Under section 90K and section 90KA of the Family Law Act (or section 90UM and section 90UN for de facto couples), a court can set aside a binding financial agreement on a number of specific grounds.
1. Fraud :
If one party engaged in dishonest conduct, such as concealing assets, providing misleading financial information or forging documents, the agreement can be set aside.
Lack of full financial disclosure: If one party didn’t disclose all their financial resources, assets or liabilities, the agreement may be considered unfair and therefore unenforceable.
2. Failure to obtain independent legal advice :
Both parties must have received advice from separate lawyers before signing the agreement.
Each lawyer must also have provided a signed statement confirming the advice was given. Without this, the agreement may be invalid.
3. Duress or undue influence :
An agreement must be voluntary.
If one party was pressured, coerced or felt forced to sign, it can be challenged in court.
4. Unconscionable conduct :
If the terms of the agreement are grossly unfair or exploitative, or if one party took advantage of the other’s vulnerability, the agreement may not be enforceable.
5. Material change in circumstances :
A court may also set aside an agreement if circumstances have changed so significantly since it was signed — such as the birth of a child or a serious illness — that it would cause hardship to one party if the agreement were enforced.
6. Impracticability :
If it has become impractical to carry out the agreement as written (for example, if a property specified in the agreement has been sold or destroyed), it may be set aside.
The High Court case of Thorne v Kennedy remains an important warning. In that case, the court declared a binding financial agreement invalid because it was signed under duress and contained unfair terms.
This landmark decision shows the importance of fairness, transparency and compliance with legal requirements when creating these agreements.
If you’re considering a postnuptial agreement, work with experienced BFA lawyers to avoid these pitfalls and ensure your agreement is robust, fair and enforceable.
Postnuptial Agreements vs Prenuptial Agreements
While postnuptial and prenuptial agreements serve the same purpose, the key difference is timing. A prenuptial agreement is made before marriage or entering into a de facto relationship and is likely to address the protection of assets brought into the relationship while a postnuptial agreement is made after the relationship has already started and may address the changes that have occurred in the relationship, such as starting a business or receiving an inheritance.
Both types of agreements are binding under the Family Law Act if they meet the necessary requirements such as full financial disclosure and independent legal advice. Whether made before or during the relationship these agreements aim to reduce disputes and protect the financial interests of both parties.
Which one is best for you depends on the timing and purpose of the arrangement. Talk to experienced lawyers to make sure the agreement is right for you and compliant with Australian family law.
How to Start the Conversation About a Postnuptial Agreement
Talking about a postnuptial agreement can be awkward but it doesn’t have to be a difficult conversation. Here are some tips to approach the topic with sensitivity and clarity:
- Choose the right time: Don’t bring it up during a stressful moment or when emotions are running high. Instead pick a time when you and your partner can have a calm and uninterrupted conversation.
- Frame it as a joint decision: Say the agreement is about both parties and fairness not mistrust or preparing for the worst.
- Focus on the benefits: Explain how the postnuptial agreement will bring clarity, protect shared goals like a family business or protect significant assets for both of you.
- Be honest about your intentions: Transparency is key. Explain why you think the agreement is important for your financial future and your relationship.
- Get legal advice early: Suggest you both see family lawyers together to get a better understanding of the legal aspects and to make the process professional.
Talking about it with respect and open communication can turn what might be a hard topic into a positive and empowering conversation for both.
Can You Do a Postnuptial Agreement Without a Lawyer?
Technically you can draft a postnuptial agreement without a lawyer, but it’s not recommended as there are strict legal requirements that include receiving independent legal advice. Without this advice the agreement is unlikely to be enforceable.
On top of this, a lawyer can help to draft a well written agreement that is fair and unambiguous and is compliant with Australian Family Law.
Trying to do a postnuptial agreement without professional help may save you money upfront but can lead to costly disputes or invalid agreements down the track. Engaging experienced family lawyers gives you peace of mind and ensures the agreement is tailored to your situation
Postnuptial Agreement FAQs
1. How much does a postnuptial agreement cost in Australia?
The cost of a postnuptial agreement in Australia typically ranges from $2,500 to $7,000 or more, depending on the complexity of your financial situation, whether there are business interests or trusts involved and the time it takes to negotiate and finalise the terms.
Each party will need their own lawyer to provide independent legal advice, so the total cost accounts for both sets of legal fees.
Typical Cost Range :
| Complexity | Estimated Cost | Typical Scenario |
|---|---|---|
| Simple | $2,500 – $4,000 | Straightforward asset split, no business interests, both parties agree on terms |
| Moderate | $4,000 – $7,000 | Some complexity — property portfolio, superannuation splitting, or blended family considerations |
| Complex | $7,000 – $10,000+ | Business interests, trusts, international assets, or significant negotiation required |
While there’s an upfront expense, investing in a properly drafted agreement is significantly more cost-effective than the alternative.
Contested property settlements through the Family Court can cost tens of thousands of dollars and take months or even years to resolve.
A well-prepared postnuptial agreement helps you avoid these costs and gives both parties certainty about how financial matters will be handled.
2. Can a postnuptial agreement include child custody or support?
No. Child custody and child support are dealt with separately under Australian family law and can’t be included in a postnuptial agreement.
3. Are postnuptial agreements legally binding in Australia?
Yes, if they meet the requirements of the Family Law Act. This includes full financial disclosure, independent legal advice for both parties and compliance with procedural formalities.
4. What if one party doesn’t comply with the agreement?
If one party breaches the agreement the other party can seek enforcement through the court.
The enforceability of the agreement will depend on whether it meets the legal requirements and is considered fair by the court.
5. Can a postnuptial agreement be updated?
Yes, agreements can be varied to reflect changes in your financial situation such as acquiring new assets or starting a business. You should consult lawyers when making any variations to ensure the revised agreement is enforceable.
6. Do postnuptial agreements apply to de facto relationships?
Yes.
De facto couples can enter into a binding financial agreement under section 90UC of the Family Law Act 1975 at any time during their relationship.
The same legal requirements apply, both parties must receive independent legal advice and provide full financial disclosure.
This includes same-sex de facto relationships.
7. Can a postnuptial agreement cover what happens if one spouse dies?
A postnuptial agreement can address how property and financial resources will be dealt with in the event of a spouse’s death.
However, a BFA and a will serve different legal purposes.
It’s important to ensure both documents are consistent and to seek advice from both a family lawyer and an estate planning solicitor.
8. Will an Australian court recognise a postnuptial agreement made overseas?
Generally, no. Australian courts will only recognise a binding financial agreement that meets the specific requirements of the Family Law Act 1975.
A financial agreement made in another country, even if valid and enforceable in that jurisdiction, will not automatically prevent an Australian court from making its own orders about property and financial matters.
If you have international or overseas assets, it’s important to get advice from a family lawyer experienced in cross-border matters.
9. Can a postnuptial agreement be terminated?
Yes. A postnuptial agreement can be terminated by a new binding financial agreement between the parties that specifically revokes the earlier one, or by a court order setting it aside.
If both parties agree to end the agreement, they must each receive independent legal advice about the termination, and the termination agreement must meet the same legal requirements as the original BFA.
If your circumstances have changed significantly, it may be worth considering whether to update or replace your existing agreement rather than simply terminating it.
How We Can Help
At Unified Lawyers we know working your way through the legal side of a postnuptial agreement can be daunting. That’s why we’re here to make the process as easy as possible.
Our team of experienced family lawyers will guide you through every step from explaining your rights and obligations to drafting a legally binding agreement tailored to your situation. We will ensure you get clear and practical advice; all legal requirements are met including full financial disclosure and independent legal advice and your agreement is fair, enforceable and protects your interests.
Whatever your reason for having a postnuptial agreement we’ll help you get clarity and security. Get in touch today.