Blended families can face unique challenges when it comes to managing finances, which can impact the stability and happiness of the relationship. Robert C. Jazwinski, a wealth advisor at JFS Wealth Advisors, emphasizes the importance of clear communication around money matters for couples in blended families. Whether the family is formed through divorce and remarriage or the death of a previous spouse, financial planning is crucial, and involving a professional advisor can help navigate these complexities.
One key issue for blended families is ensuring that any obligations to ex-spouses are clearly communicated and understood by the new partner. Couples living in community property states must carefully determine which assets will remain separate, nonmarital property. This includes assets brought into the marriage by either partner or inheritances received after the marriage. The form of ownership of these assets is also important to establish, to prevent commingling and ensure that each partner’s individual assets are protected.
Discussing each partner’s expectations regarding assets to be left to their children from previous relationships is another important aspect for blended families to address. Any existing trusts or financial arrangements should be clearly understood by both partners and captured in legal documents like wills or trusts. It’s crucial to establish agreements on financial support or inheritances for stepchildren to avoid misunderstandings or conflicts in the future.
Reviewing and updating beneficiary designations on insurance policies, annuities, and retirement accounts is essential for blended families. Ensuring that these designations align with the intentions of the account owners can prevent complications in the event of the death of a spouse. Seeking the guidance of a fiduciary financial advisor can help both partners understand their respective financial goals and needs, facilitating comprehensive communication and planning for a successful financial approach to their new marriage.
Involving a professional financial advisor can serve as a valuable resource for blended families in navigating the complexities of managing finances. The advisor can act as an impartial third party to facilitate communication between partners, helping them understand each other’s financial priorities and requirements. By working with an advisor, couples in blended families can create a financial strategy that aligns with their goals and provides a path to success that benefits everyone involved. Clear communication, thorough planning, and professional guidance can help blended families overcome financial challenges and build a stronger, more stable relationship.
