By Sarah Stewart Legal Group
People who choose to remarry have more to lose than they did the first time around. They have a more established career, more assets, and, often, children from a previous marriage. When you remarry you need to be more cautious of protecting your assets and family before you begin your marital bliss.
(1) Determine Your Consolidated Net Worth
Couples who remarry can have complex financial issues that should be addressed prior to the wedding. Some may be paying child support or alimony, have investments in their names, and already started tax and estate planning strategies for their assets.
Couples should discuss these matters prior to the wedding. Sit down and decide what your net worth is individually and then talk about it and determine what your joint net worth will be. This discussion can open up more opportunities to discuss your money management styles and who will handle what in your marriage.
(2) Make a Marriage Agreement – in Writing
I know, I know. It doesn’t sound romantic to talk about the possibility of divorce before you’re even married. But, as someone who has been there before, you know the reality that your marital bliss could end one day, and you must properly prepare.
Each party should welcome a marriage agreement, in the form of a prenuptial agreement, preferably. These documents allow you to specify what assets you want to keep separate in your marriage, so that you can claim them free and clear in a divorce.
(3) Talk About the Kids
Blended families create many different kinds of dynamics. But, regardless of your family’s dynamic, the fact remains that the children and the spouse should be accounted for in financial and estate plans. Children cost a lot of money. You must be on the same page with your new spouse about what you will and won’t pay for when it comes to the kids.
Will you both contribute to the care of the children? Or will the spouse who brings the children to the marriage be solely responsible? What if one of you makes significantly more than the other? How will you plan for the children’s expenses?
Do you want your ex-spouse to manage any money that you leave to the children? If not, you will need a more complex estate plan for your children. Speak with financial planners and an attorney with experience in estate planning to plan for your blended family.
(4) Update Beneficiaries
Life insurance, retirement accounts, even banking accounts can have beneficiaries named that will receive these assets at your death. It is very easy to forget to update beneficiaries on all of your accounts, but it is extremely important to do so after every major life event. Marriage is one of the most important.
When you create a life with someone new, you want to know they’ll be taken care of when you are gone. If you don’t update your beneficiaries, your Mom or Brother will still get the money if something happens to you, and your spouse will struggle.
(5) Change Your Wealth and Estate Plans
Another easy area to forget to update is your legal documents and wealth plans. We often create these important documents and check it off our list, to leave them collecting dust in the safety deposit box. But, as life changes, so do your plans.
Be sure to update these documents after you get married by reaching out to your estate and wealth planning professionals!