With ‘wedding season’ in full swing, chances are you will be attending a wedding that may be a second marriage. Statistically in the US, one third of weddings are a second marriage for at least one member of the couple (https://www.soundvision.com/article/wedding-statistics-in-the-united-states). Planning to combine families and finances and discuss openly how it will affect each of you, should take place prior to the big day.
Here are some tips for combining families and finances:
Be Transparent About Personal & Child Rearing Expenses. Openness and honesty regarding expenses related to your children is a must. Discuss child support payments, debts, and on-going expenses you are responsible for. Add child related expenses into your monthly budget and decide if you’re using a joint account to provide for this.
Discuss Long Term Financial Goals. Discuss goals as a couple, and goals for your children that may involve investing. Retirement goals should be a priority, but decide what to cover financially for your children. You may decide as a couple to not provide for college, first cars, etc.; but should honor the wishes of your spouse if they want to provide individually for their child.
Continue Financial Planning. Keep planning for your retirement and monitor your accounts as if you will be together for the rest of your lives. However, if you are hesitant to combine financial planning and change to your new spouse’s financial advisor, continue with your advisor and planning on your own.
Consider a Prenuptial Agreement. Combining assets may not work for everyone, and that’s ok. Address current assets, future inheritance, and acquiring assets as the marriage continues and how you’d want things divided if the marriage fails. Consult an attorney on a Prenuptial Agreement and sign prior to your wedding day.
Determine Beneficiary Statuses. Determine if life insurance beneficiaries will change, or if another policy will be purchased. Discuss beneficiaries on employer retirement accounts, and any other brokerage accounts that asks for beneficiary information.
Draft a Will. After your wedding, and especially if children are involved, consider having a will. A will should be written for your beneficiaries for you as an individual, and another will drafted for you as a couple. Consult an attorney to help you decide how you would like your assets to be divided if you, or both of you pass.
If you or a loved one is interested in learning more about how to combine their finances, please have them contact our Las Vegas Financial Advisory. We’re happy to offer a free consultation.