A financial agreement is a contract between married couples that decides the outcome of their financial resources in case of separation. This agreement is protected under the legal act “Family Law act 1975”, because it gives the proper rights to both partners. This agreement states what will happen to the finances and properties, in case of death of any party, mutual breaks up or any other such circumstance, with respect to the law. The main reason to utilize this agreement is to ensure that both parties are aware of their individual rights as well as the rights of the other party. This way, if one of the parties tries to breach the other party’s rights, they can be charged and held accountable by the law.
A financial agreement is basically just a document that states the rights of both parties. However, there is a way to compose it. The composition of the agreement plays a big role because there are certain factors that might seem unimportant but they can cause big trouble in the future if missed out. Such as the initiation date, proper contact information of parties, etc. Hence, the general format must be followed. Changes can be made in the recital of the respective rights and outcomes. A general concept of what a financial agreement should look like is given below;
1- The date on which the agreement will be made effective.
2- Introduction to both parties. This should include the name of husband and wife, age, contact information, and address.
3- Time period of their marriage.
4- Basic information about the children (if any). This includes the name and age of every child.
5- Details about their residence (the one in which they are currently living).
6- The terms on which the both parties wish to agree in case of separation, death or illness. These terms mostly include the division of the property, who will receive the deceased person’s money, who will take be responsible to raise the children, and what will become of the bank account if it’s joint.
7- The time period till which this agreement will stay effective. Mostly, this agreement stays effective till the end of the marriage or death of one person.
8- What will be result of breaching any of the rights mentioned above?
9- Lastly, the couple has to sign the document to show that they agree to all the terms stated above.
Both the parties are given their individual copies of the agreement. Which they can keep with themselves until needed.
This agreement holds multiple benefits.
• This agreement can help avoid disputes and arguments in the future in case the couple decides to break off the marriage unexpectedly.
• The document can be beneficial to either party if they feel like their rights are being violated. They can charge the other party by showing proof of the agreement.
• It can help to clear things out in case of a sudden death of one of the party. The other person will at least be aware of what they are supposed to do with the things left behind.
Template for Financial Agreement
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