Depending on ages of children brought to the marriage, very important to discuss financial issues…his kids, her kids, their financial future

Generally not as much money in a second marriage to go around.  Important to review what assets and liabilities are being brought to the marriage, and how will the responsibilities and dreams be fulfilled.  Cash flow analysis so there are no conflicting concerns on what is affordable for each component of the new marriage…his children, her children,  spousal support, child support payments, college and their needs. .  You don’t want there to be any unrealistic expectations

A second marriage does not fulfill all the broken heartaches of the first marriage.  Any financial delusion in the new relationship can cause mistrust and can spill into the new marriage.

There is no absolute or simple recommendation, it’s what mutually works for the couple and their “blended families.”

FINANCES:

Younger couple, one without children, limited resources, may have one account to pay all expenses.  Starting out as if it were a first marriage .

Separate accounts…each contribute to household/mutual expenses but keep savings and investments separate

HIS HERS AND THEIRS, shared expenses, joint savings and investments, separate discretionary accounts…debts, financial responsibilities…maintenance/child support, fun

Older children, a prenuptial plan to put financial fears at rest, provides more trusting family relationship so the children know that they will get what is theirs.  Spouse “waives his or her rights.”  Your goal is a “blended family” not one where the step parent steps in and out.

ESTATE PLANNING:

If one or both of the parties brings children to the marriage:

•     Dependent on ages of children
•     Dependent on age of new spouse in relation to children

She has no children from a prior marriage but he does:

• Don’t want to leave everything to new spouse because if she
• Remarries, those assets may go to new spouse or “their children”
• Rather than your own

Credit Shelter Trust/Bypass/”A Trust”

Maximum exemption whereby the spouse gets income for life and children get the principal…shouldn’t do if new spouse and children close in age, in effect disinheriting your own kids

Gift outright to children

Split income between spouse and children, or have a “sprinkle trust” allowing the trustee to give to spouse as needed

QTIP (Qualified Terminable Interest Property Trust) where spouse receives all income during life with no control over principal and kids get principal

LIFE INSURANCE BEST…IRREVOCABLE LIFE INSURANCE TRUST

Provide a tax free inheritance directly to the children, premiums paid by gifts to trust/children.  Also, if will changes, or prenuptial has time limit when it expires, the children know they are still provided for.

IMPORTANT WHEN STARTING OUT IN A NEW MARRIAGE/AFTER DIVORCE:

WILL CHANGES…BENEFICIARIES

LIFE INSURANCE…BENEFICIARIES

PENSION, PROFIT SHARING, IRA