Financial Planning for Blended Families
September 13, 2022
In 1966, TV producer Sherwood Schwartz created The Brady Bunch after reading that 30% of marriages are blended.1 From 1969 through 1974, viewers watched Carol and Mike Brady run an integrated and loving ‘step’ household with the help of Alice, their housekeeper. But what we didn’t see is how the Bradys revised their wealth plan once they became a bunch.
Today, thirteen hundred blended families of various configurations are created each day in the U.S.2 If you or any of your children have remarried and are starting a new chapter, we share ways to address potential financial concerns and surprises.
You want to provide for your new spouse, but also leave money to your kids. A prenuptial agreement (or if you’re already married, a postnuptial agreement) is one way to indicate where you would like your assets to go when you’re gone, including how much you would like your children to get. A marital trust is another way to divvy your assets between your new spouse and your children. Or you can leave your children money through an outright gift or via life insurance.
You don’t want to leave your money to your ex-spouse. There are many stories of ex- spouses receiving assets unintentionally due to forms that were never updated. Whenever you experience a significant life event, you should review the beneficiary designations on each of your financial accounts, such as your 401(k)s, IRAs, and life insurance, to ensure your money ends up going where you’d like it to go.
You want to leave your money to your kids, but not their spouses (in the event they divorce). Ask your children to establish prenuptial or postnuptial agreements or leave your money to them through a trust.
You want your new spouse to make medical decisions on your behalf in the event that you cannot. Make sure your healthcare proxy is up to date, so you are comfortable with who will be making decisions for you on your behalf.
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If your family experiences a transition, please contact your Washington Trust Wealth Advisor to make sure your wealth plan continues to meet your evolving needs. And contact us to learn more about wealth planning!
1 Why the ‘Radical’ Brady Bunch Almost Never Got Made, Blakemore, Erin, History.com, September 26, 2019
2 Blended But Not Broken: Step-Families, Forbes, April 21, 2021
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