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Snapshot

  • Wealth protection in romantic relationships can require a suite of legal documents including a binding financial agreement, deed of release and will.
  • The relationship between binding financial agreements and estate claims is an evolving area of law rarely tested by the courts. As the ‘great wealth transfer’ takes place, it is expected there will be more litigation in this space.
  • Due to the interplay of succession and family law, collaboration between family lawyers and estate lawyers is advised to ensure client instructions are carried out upon separation and death.

Australia is expected to see the largest intergenerational wealth transfer in history as the ‘baby boomers’ pass their estates onto younger generations. Simultaneously, rates of separation and divorce are increasing, as are second and subsequent relationships and blended families. As a result, lawyers are seeing an unprecedented demand from clients for wealth protection plans to ensure their legacy is carried out upon death.

The difference between separation and death

Both a will and binding financial agreement will be utilised in any well thought out estate plan. A binding financial agreement is made pursuant to the Family Law Act 1975 (Cth) (‘FLA’), which is federal legislation, whereas the law regarding wills and deceased estates is governed at State and Territory level.

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