Mr Taxman
Change the way you feel about taxes.
Get informed and discover what the taxman doesn't want you to know.
Sharing it with Australia, Mr Taxman is a regular Woman’s Day columist and TV finance commentator
  • click to visit Mr Taxman on Twitter
  • click to visit Mr Taxman on FaceBook
  • rss

Pre-nup agreements ... til divorce do us part

Nov 02, 2010

I am getting married in a few months' time and my fiancé has briefly spoken about getting a pre-nup agreement.  I have heard that they are not worth the paper they are written on.  Is it a waste of time?

Helen, Kangaroo Island

Congratulations Helen on getting married.  How exciting!  Wishing you many years of happiness together!

"Don't you trust me?" is the most common reaction when bride or groom is asked to sign a pre-nuptial agreement.  After all, isn't trust one of the absolute cornerstones of marriage?

We all go into a marriage with the expectation that it will last forever - and that in itself means that having a pre-nuptial agreement is a waste of time. 

But love is blind and unfortunately about one-third of marriages in Australia - or 50,000 per year - will end in divorce.  In fact, Australia is not renowned for wedded bliss with its divorce rate of 2.52 per 1,000 people ranking us seventh in the world separation stakes.

Australians are getting married later in life, so there is a greater likelihood that people have accumulated more assets which require protection.    

A lot of people think that they are not worth the paper they are written on, but under Family Law provisions, a pre-nuptial agreement is a legally binding document which is written between spouses contemplating marriage.  To be valid it must:

  • be signed by both parties; and
  • both parties must show proof that they each received independent legal advice before signing.

A well written pre-nuptial agreement may cost a few thousand dollars but will act as a deterrent for any action in breakdown and can avoid lots of nasty confrontations (and large legal fees!) in the future.  

Whilst you may think that pre-nups are only important for those that have money, they are also relevant if you are likely to acquire assets during marriage, such as family inheritances. 

Pre-nups can be terminated in the future by another finding financial agreement.  They can also be considered null and void by the courts due to:

  • fraud or non-disclosure of a material fact;
  • circumstances arising after the pre-nup was signed which makes it impracticable for the agreement to be carried out; or
  • if not considered in the original agreement, the result of a child of the marriage causes financial hardship for the parent caring for the child.

Tags: Family

Author: Mr Taxman

Comments

"Hi Am searching for many many hours trying to figure out if a prenup is necessary or not. Am not getting anywhere.. I basically want to know: - what are the financial implications of getting married? - what law applies in the event of divorce? - is there a law that protects assets pre-marriage? Fairly simple situation; one partner has property and cash, other partner small amount of cash. No children or intention to have any. What would happen if divorced after 5 years? after 10 years? after 15 years? etc Where can I find the laws that answer these questions or even better simple layman English advice for the above? Thank you Dylan"

By: Dylan on Aug 20, 2012 2:16PM

"Sounds like you need some family law advice here - I suggest that you make contact with an accredited family law specialist & they should be able to provide you with most of your answers in an half-hour meeting."

By: Mr Taxman on Aug 24, 2012 12:22AM

Post a New Comment

Media Availability

Are you interested in booking Mr Taxman for a speaking engagement or requesting his viewpoints for an article?

comments-rhsLatest Comments

  • "Mr Mark Roland Paco Loan Company. Do you need an urgent loan to finance your business or in any purpose? we are certified and legitimate and international licensed loan lender We offer loans to..."

    By: Mr Mark Roland at Jul 18, 2018 5:07PM

    Post: 101 Ways to Save Money on Your Tax Legally

  • "We are set of friends form a new university in Russia after a friend of mine hired a hacker he met on the internet did a change of school grades and he did a very good and legit work for him then we..."

    By: schoolboys at Jul 18, 2018 4:39PM

    Post: The Full Cost of Motoring in Australia

  • "Dear Loan Seeker's! We are Abdul Wei Financial Group! We offer accessible & affordable loans to individual and companies world wide. If you're still wondering if it's possible to secure loans..."

    By: Abdul Wei Financial Group at Jul 18, 2018 1:25PM

    Post: The secret to getting your loan approved

  • "Hi, I have a question re interest and shares and if it is to be capitalised or if it can be deducted from your annual income (normal job). For a short term trade where the intent was capital..."

    By: Guy Booth at Jul 18, 2018 9:23AM

    Post: Borrowing to buy shares

  • "Do you need a loan? Do you have bad credit? You need money to pay the bills? You need to start a new business? Do you have unfinished project at hand due to poor funding? contact us vi..."

    By: standardloanfirm at Jul 17, 2018 7:43PM

    Post: The secret to getting your loan approved