Highlights
- In Australia, a prenup agreement falls under the term 'binding financial agreement.'
- The pros of an agreement outweigh the cons.
- To make sure that you're not on the losing end, it is important to include financial security in the agreement should the marriage end.
'May PERAan' is SBS Filipino's podcast series which features financial experts seeking to answer the most common questions about money and finances.
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"In the Philippines, having a prenuptial agreement is a bit taboo; but here it's normal. I do understand why it would feel insulting, but it would really depend on how the agreement is crafted," solicitor Florante Abad shares.
Florante specialises in family law.
Binding financial agreement
Florante shares that in Australia, prenuptial agreements fall under the term 'binding financial agreements'.
"In the Philippines, we use the term 'prenup' because it should be before the marriage.
"Here, a binding financial agreement can be entered into before, during or after the marriage."
Pros and cons
He says that entering into this kind of agreement has its pros and cons.
"What an agreement like this gives you is certainty. It helps you plan and manage your finances and assets during the marriage and/or if it is terminated.
"In the event of its termination, how do you manage your financial affairs? With an agreement, this is clarified. Battlegrounds are delineated and confrontations in court are no longer complex."
He admits though that having children from a previous relationship can make things a bit more complicated and that costs can be deemed as disadvantageous.
"In the Philippines, the couple can be represented by one lawyer. That's not the case here. Each party has to have independent legal advice and that can cost quite a bit.
"I think though that advantages outweigh the disadvantages. With an agreement, you have the opportunity to settle how assets are to be divided in the event of a divorce. You get to agree on how children are to be supported and how debts are paid off."
How to make sure you're not on the losing end
Florante says that a binding financial agreement is not only in anticipation of nullity of a marriage, but it is in anticipation of how finances are managed during the marriage.
To make sure you are not on the losing end of the agreement, he says that is is necessary to get the advice of a lawyer regarding what should be included in it.
"You have to secure your future.
"The agreement should state that properties in the future you acquire should only be yours. You never know what could happen during the marriage. You could experience a windfall, win the lottery or build a successful business. You need to clarify that what you've worked hard for, you get to keep."
Florante also says that financial contributions are not the only things that matter in a marriage.
"For example, you manage the home. There is a financial equivalent to that.
"If your husband decides to divorce you all of a sudden, what is your financial security? That should be in the agreement - either finanacial support or lump sum support. He can't just leave you penniless."
