Wondering How to Finalise Finances After Separation?
When a relationship ends, sorting out your finances and property can feel overwhelming. But getting it right now can prevent stress down the track. In Australia, two common legal options are Binding Financial Agreements (BFAs) and Consent Orders. Understanding the difference is the first step toward making a confident decision.
Two Legal Options With Different Paths
BFAs and Consent Orders are both used to formalise property and financial arrangements after separation. But they work differently when it comes to cost, privacy, flexibility, and legal backing. This article explains both options, when each might be right, and the key pros and cons of both.
What Is a Binding Financial Agreement?
A Binding Financial Agreement is a private contract that sets out how assets, debts, and superannuation will be divided if a relationship breaks down. These agreements are recognised under the Family Law Act 1975 (Part VIIIA and Part VIIIAB).
Key features:
- Can be made before, during, or after a relationship.
- Must be in writing and signed by both people.
- Each person must get their own independent legal advice.
- Lawyers need to certify they’ve given this advice in writing.
Because BFAs aren’t approved by a court, they offer more privacy and flexibility. They’re often used when couples want to include tailored provisions, like how future inheritances or business interests will be treated.
Keep in mind: BFAs can be challenged or set aside if they’re not properly prepared, or if someone later argues there was pressure, fraud, or lack of disclosure. This is supported by recent legal commentary on the risks and challenges of enforcing financial agreements, particularly where the balance of power or disclosure has been disputed. For further reading, see this case commentary on BFA claims.
Binding Financial Agreements are one way couples can define clear outcomes without court involvement.
What Are Consent Orders?
Consent Orders are formal agreements that are reviewed and approved by the Federal Circuit and Family Court of Australia. They can cover both financial settlements and parenting arrangements.
Key features:
- Submitted to the court for approval.
- Reviewed by a registrar to ensure they are fair and reasonable.
- No court appearance is needed if the agreement meets the legal standard.
- Once approved, they become enforceable court orders.
Consent Orders give parties the assurance of a court-backed resolution and are generally more cost-effective than BFAs. They also carry a lower risk of being challenged, particularly in cases involving Separation and Divorce.
Unlike BFAs, which are private contracts, Consent Orders are checked by the court to make sure they are fair. This added oversight helps protect both people and ensures the agreement is balanced. Consent Orders are especially useful for parenting arrangements, as they provide clear structure and legal support for co-parenting in the future.
Comparing BFAs and Consent Orders
| Feature | Binding Financial Agreement | Consent Order |
| Court Involvement | Enforced as a contract | Yes |
| Covers parenting matters | No | Yes |
| Privacy | Private | Public Court Record |
| Independent Legal Advice | Mandatory | Recommended |
| Risk Of Being Set Aside | Higher | Lower |
| Time | Dependant on the complexity | Often More time-effective |
When a Binding Financial Agreement Might be Best for You
A BFA could be the better option if:
- You prefer to keep your arrangements private.
- There are complex financial elements like a trust or family business.
- You’re planning ahead with a prenup or cohabitation agreement.
- You want a highly tailored, flexible arrangement.
Just be aware that a BFA needs to be carefully drafted and legally airtight to reduce the risk of future challenges. You can learn more about what makes BFAs enforceable in this Parliamentary Committee Report.
Understanding how financial matters are resolved after separation often involves navigating issues like contributions, entitlements, and the future needs of each party. Property and Financial Settlements play a central role in that process.
When Consent Orders Make More Sense
Consent Orders might be more suitable if:
- You and your ex-partner have already agreed on how to divide assets.
- You want court enforcement without going through a hearing.
- You’re after a simpler, cost-effective solution.
- Parenting arrangements are part of the agreement.
Consent Orders work well for amicable separations where both parties are on the same page and want everything finalised with minimal fuss. These types of arrangements are a common part of Family Law.
Mistakes to Watch Out For
No matter which option you choose, it’s important to avoid some common traps:
With BFAs:
- Skipping proper legal advice.
- Leaving out financial details or assets.
- Using generic templates or online downloads without professional help.
With Consent Orders:
- Including terms the court won’t approve.
- Forgetting to update things like superannuation beneficiaries or loan accounts.
Both options require care and clarity. If something isn’t done correctly, it can delay your settlement or cause issues down the line.
Seemingly small mistakes such as unclear wording, outdated financial information or incorrect assumptions about future needs can cause serious issues later. Taking the time to go over each detail with legal support helps make sure your agreement is accurate, fair and holds up in the future.
Let’s Help You Make the Right Call
The right agreement depends on what matters most to you: privacy, cost, enforceability, or flexibility. There’s no one-size-fits-all answer, but there is a path that best suits your circumstances.
We can help you figure that out.
At Arcuri Turnbull Law, we work with individuals and families at all stages of the relationship or separation to make sure their financial arrangements are fair, legally sound, and tailored to their needs. Whether you’re just starting the process or ready to formalise your agreement, our team is here to support you.
Still weighing up your options?
There’s a lot to consider when deciding how to move forward after separation. Whether you’re unsure which agreement is right for you, or you’re ready to take the next step, having the right legal support makes all the difference.
If you’re looking for a family lawyer who puts your interests first and explains your options in plain English, book a free initial consultation with Arcuri Turnbull Law today.
We’ll help you make informed, confident decisions that are backed by experience, clarity, and care.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ut elit tellus, luctus nec ullamcorper mattis, pulvinar dapibus leo.
