If you’ve already ended one marriage, trusting a new partner can feel impossible. Going through one divorce can make you wary about putting yourself at risk of going through that emotional and financial stress again. Plus, once you’ve been married and divorced once, your finances become more complicated, making the risks even higher.
However, getting remarried is becoming more common than ever. Nearly a quarter of all married people today have been married before. This number is only rising, too: 40% of all weddings involve at least one person who’s been married before.
How do all of these people find it in their hearts to trust a second spouse? In part, it’s likely because they have found ways to make themselves feel more secure, both financially and emotionally. While emotional security is different for everyone, financial security in a second marriage looks similar for most people. Here’s why second marriages can be more complicated financially and how to keep your finances secure so you can enjoy your relationship.
Financial Complications of Second Marriages
First marriages typically benefit from occurring between two relatively young people, early in their careers, without outside attachments. That’s not the case for second marriages. Most people getting married a second time are established in their careers and have other financial complications.
To combine and protect assets in your second marriage, you’ll probably need to consider factors like:
- Higher income
- More assets
- Alimony payments
- Child support
- Out-of-date wills
- Retirement planning
- Estate planning
When these considerations are combined with emotionally trusting your partner, a second marriage may seem daunting. Still, by making the proper preparations in advance, you can make all these potential complications into non-issues.
Maintaining Financial Security in Your Next Marriage
While second marriages are more complex, you can take several steps that will keep things simple. As an added bonus, these actions can help you feel more secure in your relationship and more confident in your decision to remarry. These four tips can help you keep your finances under control with your new partner.
Talk to Your Future Spouse
One benefit of second marriages is that both parties have more life experience. This means more you both have better financial literacy, emotional stability, and maturity. While couples entering first marriages may not feel comfortable talking about money, you should have no hesitations about discussing finances with your potential second spouse.
Talking about money can make all the difference in how you handle things. A simple discussion, or series of conversations, can help you understand your partner’s approach to money and current financial status. You can also talk about things like how you’ll budget, what savings and expenses you’ll prioritize, and how you want to invest. When you talk about money, you guarantee you’re both on the same page and prevent arguments down the road.
Get a Prenuptial Agreement
Another touchy topic for first marriages is the prenuptial agreement. Young couples want to believe they’ll be together forever, so they may ignore prenuptial agreements as “unromantic.” However, signing a prenuptial agreement can be one of the most romantic things you can do for your partner. It shows that you respect them. You love them enough that you’re giving them legal protection in case of inevitable future changes.
Prenuptial agreements can cover every aspect of your shared finances. You can explicitly state which assets are to remain separate, how marital assets will be defined, and even whether alimony is to be awarded in the case of a divorce. When you both sign a prenuptial agreement, you’re protecting both of your futures.
Prepare for Retirement
Retirement is a topic that’s more important in second marriages. The average age for a second marriage is 37 for women and 39 for men. By this stage of life, you’ve probably been saving for retirement for more than a decade. These savings are essential for your golden years, so it’s wise to protect them.
You can protect retirement assets in a few ways. One method is to use a prenuptial agreement to keep retirement accounts as separate assets. Another is to set up a trust for your retirement, in which you’re the beneficiary. Either way, should your new marriage end in divorce, you won’t have to worry about losing your entire retirement fund.
Set Up Your Estate
Last but not least, if you’ve been through one divorce already, your estate planning is probably more complicated than you’d expect. For example, if you have children with your ex-spouse, you’ll need to clarify from the beginning of your new marriage how you want your estate handled.
Unless you have a specific will in place, your current legal spouse inherits all your possessions through intestate inheritance. Even if you do have a will in place, your spouse still retains the right to 50% of your marital estate. If you want to ensure that specific possessions or assets go to your children or other heirs, you should write a will stating precisely what you want to go to whom.
An even more secure option is to set up a living trust before you get married. A living trust holds ownership of assets for you. You can be the beneficiary of the trust until your death, at which point your chosen heirs become beneficiaries instead. This lets you make sure that your final wishes are followed without your new marriage impacting your estate.
Prevent Money from Marring Your Marriage
If you’ve found someone who makes you want to try marriage again, you’re lucky. You should take steps to make sure that you can enjoy this relationship free from financial or legal concerns. The best way to do that is to prevent those problems before they can come up.
If you’re ready to protect your finances and your relationship, reach out to an expert family law attorney. They can help you understand your needs and set up the structures and contracts to keep you safe. Schedule your consultation today to take the next step to a secure second marriage.