Quick answer: A separation agreement in Australia can cost as little as $3,299 when you use our Separation Agreement Kit (including BFA planner) and Legal Review Service. Going through a family lawyer for full drafting instead typically costs $300-700 an hour, reaching thousands of dollars for even simple cases.
Creating a separation agreement, or binding financial agreement can be a very expensive exercise depending on which approach you take. However, if you attempt to divide assets after separation without a binding agreement, it may cost you even more if one of the parties decides they want to have a second bite of the cherry at a future time.
It’s worth exploring the different options available to you to determine the most cost-effective process for your circumstances.
The Number One Factor in Separation Costs
One thing will determine the cost of your financial separation more than any other. How amicable and co-operative can you be during the settlement?
Even if the split itself were emotionally hurtful, you would hurt yourself more by making a financial separation difficult. A calm conversation over coffee is over a thousand dollars cheaper than an angry conversation in a law office. And tens of thousands of dollars more affordable than a courtroom.
Avoid being the person who finishes with nothing because they were angry. A financial separation agreement is just that, an agreement. Working together with respect means you will walk away better off.
The Cost of Having Lawyers Draft Your Agreement
Employing a family law practitioner in Australia is expensive. Your typical divorce lawyer can set you back anywhere between 300-700 dollars per hour. Even if you have very few assets and liabilities, your separation agreement cost may add up to thousands simply for the draft. This agreement would need to be made binding by having independent advice given to both parties, which can cost you thousands more.
The Cost of Doing the Groundwork Yourself
You can save thousands by doing the part that doesn’t need a lawyer.
Think about what actually happens when you engage a firm to prepare your agreement. Before anyone drafts anything, you sit down and answer questions. What do you own? What do you owe? When did you separate? Who gets what? Then come the account balances, the superannuation details, the mortgage, the investment property address. You supply all of it, and the meter runs while you do.
That information gathering is the same work no matter which road you take. It is also the part you can do yourself, at your kitchen table, for $49.
That is what the BFA Planner is. You answer a set of plain-English questions about your situation and how you wish to divide things, in your own words and at your own pace. Your answers are then used to build your draft Financial Agreement, compliant with Australian Family Law.
The completed Planner is yours to keep either way. Whatever you decide to do next, you will have to account for what you own, what you owe and how you propose to divide it, so the work is not wasted.
However, it is important to recognise that a financial agreement is only legally binding under the law once both of you have also received independent legal advice. That is a requirement of the Family Law Act 1975, not an optional extra, and it applies no matter who prepared the document.
Our Fixed Price Legal Review Service covers exactly that, at $3,250 for both parties, unless you have a particularly complex situation. It gives each of you access to an Australian lawyer who provides the advice and the certificate the law requires. These lawyers work with you over the phone or zoom, making things far less costly and stressful.
Applying for Consent Orders
At first glance, applying for a consent order from the court may seem like an inexpensive alternative to having a financial agreement. After all, the filing fees are less than two hundred dollars. However, consent orders drafted without the help of legal practitioners are commonly refused by the court, leaving you out of pocket with nothing to show for it. Furthermore, the court is rarely willing to give a consent order to any division they consider “inequitable”.
You can learn more about Navigating Your Separation Agreement Costs: A Guide to Smart Spending here.
For example, you may wish to split your property 75/25, based on the value of a company owned by one spouse. This is a common occurrence, as the value is recognised to only exist because of how the spouse runs it, and selling the company would not produce the same value. However, the Family Court is rarely willing to give orders with such an “inequitable” split, so it would be unlikely to consent to such an arrangement. Using a binding financial agreement, you may be able to create such arrangements and have them bound by law. The independent lawyer you engage when creating a binding financial agreement can explain what disadvantages you may face – if they believe you are not fully informed and willingly consenting, they can refuse to provide the certification required to make the agreement binding.
Five Tips for Lowering the Cost of Your Settlement Agreement
Five things you can do from the beginning will save you hundreds to thousands of dollars on your financial agreement.
- Work Together. Arranging a financial separation should be about protecting your finances and moving on with your life. The second you make it about “winning” or revenge, the more the legal bills add up.
- Do the groundwork first. Before you sit down with anyone who charges by the hour, get your own information in order. What you own, what you owe, and how you want to divide it. Remember, every fifteen minutes you save yourself from being in a legal office, you pocket over one hundred dollars.
- Don’t Try to Be Tricky. If a dispute arises and you have not been one hundred per cent open and honest with the other party when you made the agreement, the court will set it aside. Every cent spent on that agreement will be wasted, you will be faced with an expensive court hearing to decide on the division of assets, and you may even face further consequences. Intentionally trying to mislead the other party by not disclosing an asset or another relevant matter, such as an inheritance received, is classed as fraud under the Family Law Act 1975.
- Think outside the Box. Having one party keep the matrimonial house and offering half the value in another form almost always ends up being better for both people. Your spouse’s company might be making a million dollars while they are boss, but would you be able to sell it for that if you were running it?
- Act Now. You might be tempted to wait until you are divorced, thinking things will be easier. They won’t. The further away you are from your separation date, the more complex a court hearing will be if there is a dispute. Complexity equals money that you will lose.
Five Common Mistakes Made While Separating
If you rush into a financial separation process without doing your homework, there are many ways you can lose money and have nothing to show for it. Couples who have wasted money during separation regularly mention these five common mistakes.
- Not making a financial agreement binding. If you do not undergo the process of receiving independent advice, any dispute will have the entire agreement set aside as if you had written it on a serviette.
- Using a document that wasn’t written for Australia. It is easy to find free “separation agreement” templates online, and just as easy now to have an AI generate one in seconds. Neither is drafted for Australian law, and neither accounts for the independent legal advice the Family Law Act 1975 requires.
- Using your general practitioner lawyer. Many families have their own lawyer for general matters, but this person is rarely an expert in family law and may need to excuse themself from a case if there is a dispute over the agreement.
- Opting for consent orders without seeking advice. Rather than create a financial separation agreement, some couples opt to apply for the court to make orders. Without these being looked over first by a lawyer, they tend to be rejected, wasting your application fees. Binding agreements also offer more creativity than consent orders while having the same validity if created properly.
- Not considering superannuation. Superannuation is an asset that can be split under special circumstances. If you are considering doing so, you will need a binding financial agreement that includes superannuation splitting and is suitable for the type of fund you intend to split.
What Is the Cost of Legal Separation v Divorce?
According to Australian Law, legal separation is simply when two people no longer live as a couple. A single party can instigate this, and you can be legally separated under one roof. You do not need to register a separation, and no cost is involved.
Even though you may not yet be divorced, many government services require you to notify them in the case of separation. Centrelink will require proof of separation if either party receives payment from them. You will need to fill out a Separation Details Form and may need to supply further paperwork if you are separated under one roof.
How Much Does a Divorce Cost?
After twelve months of separation, you can apply for a divorce. You can apply together or individually, and the process of filing for a divorce can be done online. Filing for divorce currently costs $990, but this can be reduced to $330 in special circumstances.
Are There Benefits to Staying Married but Separated?
There are few benefits to staying married. Until divorce, neither party may remarry, and those who have not updated their Will may have the majority of their estate automatically go to the other person. Even after divorce, unless a financial separation has occurred you still have your assets and debts entangled with the other person. Even if you choose to separate without divorce, it is vital you become financially separated as soon as possible.
What if We Are Living Apart but Not Legally Separated?
Living apart is not the only requirement to being considered legally separated. While you may separate from your partner without their consent, you must still inform them of this situation. If you are living apart and one party believes they are still in a relationship, there may be cause for a dispute. If you are afraid of such a situation, seek legal advice. Inform a third party of your separation and consider creating a declaration statement.
Frequently Asked Questions About the Cost of Separation
The separation agreement is only one part of the separation and divorce process. Other steps can also cost you money, and it is worth knowing how much and to whom you may need to give money.
Does a de facto separation cost less than a divorce separation?
The financial separation of a couple costs approximately the same regardless of whether they were in a de facto or marriage relationship. A different binding financial agreement is needed for each scenario, and your answers in the BFA Planner determine which one applies to you. You never need to work out which section of the Family Law Act 1975 covers your situation.
Do we both have to pay, or is $3,299 the total?
$3,299 is the total for both of you in 95% of cases. That is $49 for the Separation Agreement Kit and $3,250 for the Document Review Service, which includes the independent legal advice and certificates both parties need. Compare that with a law firm, where each of you pays separately.
Is the whole amount payable upfront?
No. You pay $49 to start. Once you send us your completed Planner we confirm we have understood your situation, at no charge. Only then does the $3,250 become payable before the legal advice stage.
What if we can’t agree on how to divide things?
Then this isn’t the right route for you yet, and you would waste your money starting it. A financial agreement records a decision the two of you have already made. It is not a way of reaching one. If you are still in genuine dispute, what you need first is a mediator or a family lawyer, and you are welcome to come back once you have reached agreement.
Ready to take the First Step on the Peaceful Path to Settlement?
Start saving time, stress and money now. Get on the Peaceful Path to Settlement with the Separation Agreement Kit, from $49, and take control of your property settlement. Suitable for all separating couples – married, divorced or de facto
Get Started with a Separation Financial Agreement Kit- Just $49