Blended Families

You’ve been dating over a year, things are going really well and you’ve decided that you want to move in together. All you need to do is sell your house, move into his/her’s and book the moving truck. Right? Sadly the right answer is wrong!

Before you get swept along in the thrill of the moment you need to stop and take a practical look at how this next major step could impact on your financial situation. I am not just talking about budgeting for household expenses here. You need to consider the protection of not only your own assets, but also your future partner’s and how any joint assets will be owned. This becomes even more important when there are children from previous relationships involved.

Once you are married, or have been in a defacto relationship for more than 3 years, all property of the partnership becomes “relationship property” unless you contract out. The most commonly used term for an opting out agreement is a pre-nuptual or “pre-nup”. There are some simple steps you can take before entering into co-habitational bliss, which could make things a lot more straight-forward if things either don’t work out or one of you were to die.

Okay, I’ve got you thinking. So, how do you raise this rather delicate subject with your beloved? Firstly, remember that this is not just important for you it is important for him/her and any family you have. This is not about whether you think the relationship will work or not. This is about ensuring you are on the same page with your current financial situations and how future assets and income should be handled.

We have all seen the fall out from relationships where this wasn’t addressed. So go on dim the lights, put on the Barry White Collection, crack open the Chardonnay and bring the subject up. Chances are your partner has been thinking along the same lines anyway and will be relieved you have broached this.

Things to consider:

• Do you want to keep your existing assets separate?
• Do you currently have a family trust and what stage are you at with your gifting programme?
• If you don’t have a trust is this something you should be considering?
• Do you have any company shareholdings or are you self-employed? How could your new relationship impact on your business partners without an agreement? 
• Perhaps you are buying a property jointly do you want to purchase this as joint owners or have you considered being tenants-in-common, owning equal or unequal shares?
• Talk to your lawyer first to ensure you have looked at you situation thoroughly. You will each need to seek independent legal advice if an opting-out agreement is required. 
• If you have children, would you want them to benefit from your assets if anything happened to you?
• When was the last time you reviewed your life and personal insurances? This should be done whenever you have a major life change.
• Is your will current? You should complete a new one whenever you have a major life change.
• Do you have enduring Powers of Attorney for care and welfare and/or property?
  

Once you have explored these items and sought professional advice you can rest assured that you have started out with your new life on the right foot.

Now is also a time to be considering the advice of a qualified financial adviser, to ensure you are looking after your joint financial well-being for the next 50 years.

Contact the team at G3 Financial Freedom now!