Moving in with your partner is an exciting progression in all relationships. Many things need to be considered pre-move. Some things to consider include:
Establishing a binding financial agreement doesn’t necessarily mean either person in the relationship expects the relationship to break down. Rather, it is an incredibly beneficial tool to ensure your personally accumulated wealth is secure should the relationship unfortunately decline.
This can be particularly important for adults entering into a relationship where both parties have accumulated wealth separately and wish to ensure its security.
Binding financial agreements can be drafted before, during or after a relationship has ended. There are time limits that apply to financial orders – 1 year from the date your divorce has taken effect or within 2 years from the date that your de facto relationship ended. The sooner a financial order is created, the better for all parties involved.
Furthermore, you may wish to ensure that the wealth you have personally accumulated is distributed accordingly to your wishes. Should you unfortunately pass away after moving in with a new spouse, your spouse may contest your Will to ensure they receive a portion of your estate.
This could result in the nominated beneficiaries of your estate forking out significant legal fees to defend your estate wishes.
Establishing a Testamentary Trust could resolve the above contesting issue. Testamentary Trusts are also commonly known as bloodline trusts as they ensure security of assets to be distributed and available only to those within the bloodline of the Will maker (i.e. children), where nominated. These trusts are only activated upon death of the will maker and do not cost anything to maintain while the Will maker is alive.
The bloodline security of Testamentary Trusts ensures spouses, ex-spouses and/or in-laws do not have access to the Will-makers estate. This can be particularly important where an adult child is going through a divorce when or after they receive an estate benefit. The ex-spouse of the Will makers beneficiary (i.e. adult child) is unable to consider the inherited wealth in the pool of assets being distributed through the divorce process.
There are other tax and distribution benefits associated with Testamentary Trusts. To find out more, contact us or speak with a trusted family lawyer.