Proper handling of finances today and in the future can avoid tensions in blended families.
Advisor.ca recently offered some advice in the handling of problems with blended families in its article “Five ways to navigate blended-family finances,” which includes advice on the proper handling of finances in today’s world and in the future.
The tips include:
- Make sure all estate planning documents are updated to reflect the circumstances of the blended family. Asset distributions may need to be modified to make sure everyone gets a fair share of a parent’s estate.
- Choose an executor carefully as you will need to designate someone who has the respect and trust of both the new spouse and the previous children.
- Creating a trust and a gifting plan can be great ways to make sure adequate provision is made for everyone in the family. Trusts can be used to make sure a spouse has the necessary resources to live on and that children from a previous marriage cannot be cut off from receiving an inheritance.
- Buying life insurance can be another good idea as it can provide needed cash for expenses and help equalize inheritances when assets are difficult to divide.
- In some situations the best thing to do is to get a prenuptial agreement before getting remarried.
An estate planning attorney can guide you in avoiding the usual problems of dealing with a blended family.