Binding financial agreements in estate planning explained for Gold Coast families

Estate planning is about more than wills and inheritance. A binding financial agreement (BFA) can act as a planning tool to protect family assets if a relationship ends. Under the Family Law Act 1975, a financial agreement sets out how property and financial matters will be handled after separation or divorce. Queensland Family Law Practice helps families on the Gold Coast integrate BFAs with wills and estate plans for peace of mind.

What is a financial agreement

A BFA is a legally binding contract under the Family Law Act 1975 that deals with property and financial matters if a relationship breaks down.

Sometimes called a “prenup” or post-separation agreement, it allows married couples and de facto couples to decide how assets and liabilities are divided if the relationship ends. It can also address spousal maintenance and financial arrangements tailored to the parties involved.

Think of it as a private contract that gives you certainty about division of property without leaving the decision to the family court.

How financial agreements support an estate plan

A BFA helps safeguard assets and complements wills and testamentary structures.

Estate planning often focuses on wills and trusts, but for blended families or remarriages, BFAs can add another safeguard. By clarifying how property and financial resources are treated in the event of separation, a financial agreement reduces the risk of disputes that could derail estate distribution.

Benefits for estate planning

• Helps ensure family wealth passes to intended beneficiaries
• Protects assets one party brings into the marriage or de facto relationship
• Minimises the risk of contested wills by reducing uncertainty
• Provides clear rules for handling property and financial resources

On the Gold Coast, we often see BFAs used where parents want to leave an inheritance to a child who is in a second marriage – the agreement ensures the inheritance stays with the child rather than being divided if the relationship ends.

Binding financial agreements and wills

BFAs cannot replace wills but work with them to protect family assets and reduce disputes.

A will sets out what happens on death, while a BFA governs what happens if a relationship breaks down. Together, they strengthen asset protection. A will should be updated whenever a financial agreement comes into effect to keep both aligned.

Quick comparison

Key considerations under family law and the Succession Act

Estate planning must align with family law requirements and state succession rules.

The Succession Act allows eligible family members to bring claims against an estate, even if there is a will. A binding financial agreement can reduce what is exposed to such claims by clarifying entitlements during life, but it does not eliminate all risk.

Key considerations

• Full disclosure of assets and financial resources is required
• BFAs do not remove family provision rights under the Succession Act
• Testamentary trusts can add another layer of protection
• Blended families and stepchildren often require careful structuring

A blended family on the Gold Coast, for example, might use both a BFA and testamentary trust to balance support for a surviving spouse with protecting inheritances for children from a first marriage.

Entering into a financial agreement

Parties must receive independent legal advice and disclose assets fully for enforceability.

For a BFA to be binding, each party must receive legal advice about its effect and its advantages and disadvantages. Solicitors then provide signed certificates confirming this advice. Agreements must be in writing, signed, and properly executed.

Steps to make it binding

1. Each party gets independent legal advice
2. Exchange of full financial disclosure
3. Draft agreement tailored to the couple’s circumstances
4. Proper execution and safe storage with estate documents

Without these steps, a court may later set aside the agreement.

Advantages and disadvantages of BFAs in estate planning

BFAs offer certainty and asset protection, but they also have limitations.

A useful way to decide is to ask: Would the cost and effort of a BFA be outweighed by the potential conflict if no agreement exists?

The interplay between family law and estate planning

Family law and estate law are separate, but they overlap in practical ways.

• A BFA may reduce claims on estates by limiting property entitlements
• Wills and trusts ensure wealth passes to intended beneficiaries
• Courts still weigh fairness, even with agreements in place

For families with significant assets in Queensland, using both tools together is often the safest strategy.

When this may not be the right fit

Simple estates without significant assets may not need a BFA.

Couples with modest property, equal financial contributions, and little risk of dispute may find a straightforward will sufficient. The formality and cost of a financial agreement may not be justified.

If you’re unsure, think about whether there are blended family dynamics, expected inheritances, or business assets to protect. If not, a will alone may be enough.

How to judge if you need this now or later

Consider a BFA if expecting inheritance, entering a second marriage, or holding significant wealth.

Life events that may trigger the need for both a new will and a BFA include:

• Marriage or entering a de facto relationship
• Receiving a significant inheritance
• Starting a blended family or having children
• Acquiring substantial property or a business

Delaying can leave assets exposed to disputes — both during life and after death.

Next steps with Queensland Family Law Practice

Seek tailored advice to integrate your BFA with wills and estate planning.

Queensland Family Law Practice’s experienced family lawyers on the Gold Coast can help you draft agreements, update wills, and coordinate estate planning. Professional guidance ensures legal requirements are met and your wishes are respected.

Next steps

• Book a consultation with a family lawyer
• Review your current wills, assets, and estate structures
• Draft or update BFAs with full disclosure
• Align estate planning tools for long-term protection

Secure your family wealth with expert guidance. Contact Queensland Family Law Practice on the Gold Coast for confidential advice on binding financial agreements and estate planning.