Entering a second marriage, most brides and grooms are older, wiser, and—hopefully!—wealthier than the first time they walked down the aisle. And it's a good thing, too, because money matters can get a lot more complicated after that second "I do," particularly if one or both spouses has financially dependent children from previous relationships.
Be sure to avoid these potential pitfalls:
1. Falling back on the money habits from your first marriage. If financial issues were a source of stress or dispute in your first marriage, be careful not to allow those unresolved issues or emotions to seep into this new relationship. Remember this is your chance to write a new story—be sure it is informed and inspired by your hard-won experience and knowledge, but not unduly burdened by the past. Allow your open heart to inspire an open mind as you work together with your new partner to build a better, more fulfilling future together.
2. Not talking about money upfront. Communication is key in any successful relationship. Be upfront with one another about how you'd prefer to handle both everyday finances—spending, saving, and paying bills—as well as long-term financial goals such as retirement, and how and whether you plan to pass along your assets to children. This is especially true if you and your spouse are coming to the marriage with significantly different levels of wealth or comfort around spending or debt. Work together to find a balance and, if necessary, don't be afraid to reach out to a neutral third party for additional perspective.
3. Underestimating the costs of a blended family. Are you uniting multiple children under one roof? Still supporting adult children or aging parents? If so, you'll need to create a family budget that frees up the resources necessary to meet those responsibilities—even if it includes obligations to one or both of your former spouses. Factoring in the full costs of both new and existing arrangements as you do so will help prevent confusion later on.
4. Not updating your beneficiaries. Failing to update your beneficiaries could mean that your assets pass on to your ex after your death. Remember to review and revise all accounts, including your bank, retirement, and insurance accounts, keeping in mind any contractual obligations from a previous divorce that might prevent you from doing so.
5. Establish an estate plan together. Though it may not be the most pleasant topic of conversation, it's important to discuss whether you're planning to leave your assets to your new spouse or children from a previous marriage—and also that everyone who will be affected is aware of your decision to mitigate additional stress or arguments among your loved ones after you've passed away. You'll also want to review your insurance plans to make sure that your current coverage is adequate to cover the needs of your new family in a worst-case scenario.
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