By Beth Kotz
Your second marriage is an opportunity to learn and grow from any past mistakes that may have haunted your previous relationship. In order to move forward it can take a great deal of compassion and understanding to begin discussing finances with your new spouse.
As you prepare to tie the knot for a second time, you will need to recognize and plan ahead for the myriad financial challenges that may have caused strife during your first marriage. When problems arise from one partner’s recreational spending or accumulation of debt, these tips can help you avoid those past pitfalls and develop a sound financial future the second time around.
In many families, finances were never discussed out in the open. If open discussions about your finances were not a part of your first marriage, changing things this time around may feel overwhelming. Consider starting off your open discussion by meeting with a financial advisor. Working through key issues such as saving for retirement or how much you can spend on leisure activities may be easier with an independent third-party. Set aside a regular time for discussing finances when you will not have any interruptions.
Blending Your Finances
Blending your new family’s finances will require some new rules. During your meeting with a financial advisor and in your discussions with each other at home, talk about what worked and what did not work for your previous marriage. Feel free to toss out those old rules, even the unwritten ones that simply did not work. If your previous spouse had no interest in finances and you handled it all yourself, make sure that your new spouse is equally involved and knowledgeable about your new family’s finances. Have a plan on how to proceed with joint expenses such as housing, utilities, taxes and joint investments.
Understanding Your Partner’s Feelings About Money
In some relationships, one person is a “spender” while the other is a “saver.” It is important to have a clear understanding of your partner’s feelings and relationship with money before getting remarried. You can ask each other about different situations, such as whether your partner feels like it is more important to save for retirement or to fund a child’s college education. One person may enjoy luxury vacations and have no interest in home ownership. Identifying these differences can help you to avoid arguments when an unexpected expense comes up. Have a plan for moving forward as a team.
Protecting Your Children
Protecting your children is also important for the finances of your new family. Children from your first marriage or your spouse’s first marriage may have priority for survivor’s benefits and life insurance policies. Your wills may also become important considerations, especially if your spouse has his or her own assets. You may also factor in the well-being of your children. If one partner feels that sleep-away summer camps are a good investment and the other feels that they are unnecessary, you will need to work on a compromise.
Preserving Your Assets
Consider implementing a prenuptial agreement into your wedding preparations. You do not have to be extraordinarily wealthy to benefit from a prenuptial agreement. These documents can be drawn up in a way that protects the assets you worked for before getting remarried. A family lawyer can help you and your new spouse to develop an agreement that protects your assets and creates a distribution of assets that is fair to you and your dependents.
Maintaining a Personal Account
Maintaining a personal checking and savings account gives you peace of mind. You spent some time on your own and got used to managing your own money, and maintaining a personal bank account provides you with some control. Keep a separate credit card account of your own for maintaining and building solid credit. Holding your own bank accounts allows you to feel secure and allows you to manage some of your money how you prefer.
Talk regularly with your spouse and make tweaks as needed with your finances. Regular communication and having a plan makes your money work for your marriage rather than causing arguments. Agreeing on how to manage your new family’s finances in advance of marriage allows you to start out your new marriage on a solid foundation.
Beth Kotz is a business writer and contributor to Credit.com. She has also been featured as a writer and editor for numerous blogs in the energy, entertainment and home verticals.