Binding financial agreements in Australia: prenups that actually hold

A binding financial agreement, often called a prenup, is a private contract between married or de facto partners that settles how property and superannuation would be divided on separation. It generally holds only if you each get independent advice from separate lawyers before signing, and courts can still set one aside for non-disclosure, pressure or changed circumstances. We draft and review them, and advise when consent orders fit better.

In this article

1. What is a binding financial agreement?
2. When can you make a binding financial agreement?
3. The non-negotiable formalities
4. When can a court set a BFA aside?
5. BFA or consent orders?
6. What a good agreement covers
7. The conversation is the hard part
8. Questions we are asked about BFAs
9. Where we fit
10. The bottom line

What is a binding financial agreement?

A binding financial agreement, or BFA, is a private contract between partners, married or de facto, that deals with how property, superannuation and financial resources would be divided on separation, and can also deal with spousal maintenance. Its defining feature is what it excludes: a properly made BFA ousts the court's power to divide your property under the usual just-and-equitable framework. You are choosing your own rules in place of the court's. That is precisely its appeal, and precisely why the law surrounds it with formality. The law in question is the Family Law Act 1975 (Cth), under which these agreements are made.

When can you make a binding financial agreement?

• Before marriage or cohabitation: the classic "prenup", often protecting assets built before the relationship, an expected inheritance, or children of a first marriage.
• During a relationship: commonly where circumstances change: a business is founded, an inheritance lands, or a couple reconciles on agreed financial terms.
• After separation or divorce: as one of the two ways to finalise a property settlement without going near a courtroom.

De facto couples, including same-sex couples, have their own mirror provisions. The timing changes the drafting, not the essential machinery.

The non-negotiable formalities

For a BFA to bind, each party must receive independent legal advice, from separate lawyers, about the effect of the agreement on their rights and its advantages and disadvantages, before signing. Each lawyer signs a statement confirming the advice; the statements are exchanged; the agreement is signed by both parties. Skip or shortcut any element and the agreement is generally not binding. A court has a limited power to declare an agreement binding where the advice or statement requirements were not met and it would be unjust and inequitable to treat it as not binding, but that is a discretionary rescue no one should plan to rely on. This is not a document you can buy as a template, sign at the kitchen table and expect to hold a decade later against a well-advised challenge.

When can a court set a BFA aside?

Courts can, and do, set aside financial agreements. The recognised grounds include fraud and non-disclosure of significant assets; the agreement being signed under duress, undue influence or unconscionable pressure, of which the wedding-eve ultimatum is the notorious example; impracticability arising from changed circumstances; and a material change concerning the care of a child that would cause hardship. The High Court's treatment of pressure in this territory reset drafting practice across the profession. The lesson is not that BFAs are futile. It is that they must be prepared unhurriedly, on full disclosure, with independent advice on both sides, and reviewed when life changes.

BFA or consent orders?

Separated couples finalising property have two instruments. Consent orders are approved by the Federal Circuit and Family Court of Australia, which checks the deal is just and equitable and explains on its website how to apply; approval brings the court's authority and near-bulletproof finality. A BFA involves no court and no fairness check, which makes it faster and more private, and suits deals a court might hesitate to bless, or couples who have not yet separated at all, where consent orders are generally not available. Broadly: consent orders are the default for post-separation settlements; BFAs earn their keep before and during relationships, and in bespoke situations. We advise on which fits, not which is fashionable.

What a good agreement covers

• A complete, honest schedule of each party's assets, liabilities and super: disclosure is the foundation stone.
• How existing assets are quarantined, and how property acquired together is shared.
• Treatment of the home, businesses, trusts and inheritances, both received and expected.
• Superannuation, including any splitting arrangements.
• Spousal maintenance, to the extent the law allows it to be dealt with.
• Review triggers: marriage, children, ten years' passage. For de facto couples, marriage is more than a review trigger. An agreement made under the de facto provisions stops being binding if the couple later marry each other, so a couple who may marry should have the agreement drafted so that it also operates as an agreement made in contemplation of marriage. Agreements written for a two-year relationship age badly over twenty.

The conversation is the hard part

Raising a BFA with someone you love can feel like planning the funeral at the engagement party. In practice, couples who navigate it well treat it as financial transparency rather than distrust: both partners see everything, both get independent advice, both know where they stand. Done early, months rather than weeks before a wedding, it becomes one honest conversation instead of a standing grievance.

Questions we are asked about BFAs

Is a prenup romantic poison?

Our observation is the opposite: the couples who struggle with the conversation usually struggle with money transparency generally. The agreement forces the full financial picture onto the table once, early, with advisers in the room, which is a healthier foundation than discovering each other's debts in year six.

Can one lawyer act for both of us to save money?

No, and any arrangement that pretends otherwise produces an agreement built to fail. Independence of advice is the load-bearing wall of the whole structure.

My partner handed me an agreement two weeks before the wedding. Now what?

Slow everything down. Signing under that kind of pressure is precisely what courts examine when agreements are challenged. A proper review takes time; a wedding date is not a legal deadline.

We signed one years ago and never updated it. Does it still work?

Perhaps, but children, business sales and property purchases can strain an old agreement's assumptions, and a material change in circumstances relating to the care, welfare and development of a child that would cause hardship is a statutory ground for setting agreements aside. Reviews are cheap; challenges are not.

Where we fit

Spencer Alexander Lawyers drafts financial agreements, provides the independent advice and certificate for agreements drafted elsewhere, and advises on setting aside agreements that should never have been signed. Our fee for a binding financial agreement is from $3,025 per party including GST, and our fees page sets out what that covers and what costs more. Other work is quoted in writing before we begin. If your situation is post-separation, read how property is divided and the 2025 reforms first, then talk to us about which instrument, BFA or consent orders, suits you. More at our family law page.

The bottom line

A binding financial agreement is neither romance insurance nor a magic shield: it is a serious contract that rewards serious preparation. Made early, honestly and with independent advice, it holds. Made under pressure with recycled templates, it fails exactly when needed. Decide which kind you are making before you start.

Sources: Family Law Act 1975 (Cth), section 71A, Part VIIIA, and sections 79, 90SM, 90UB to 90UD, 90UJ and 90UM.

This guide reflects the law applying in Victoria as at September 2026. It is general information only, not legal advice, and does not take your circumstances into account.