Not only are the financial issues of blended families more complex, but the emotional issues around those decisions are much more of a challenge to navigate.
The Issues
Blending families – from the emotional to the physical - is a difficult balancing act. Add to this equation the financial trifecta of “yours, mine and ours,” and you have a breeding ground for issues to develop.
Not only are the financial issues of blended families more complex, but the emotional issues around those decisions are much more of a challenge to navigate.
Blended Families on the Rise
Gone are the days where mum, dad and 2.5 kids made up the average Australian family. A review of some statistics shows just how much things have changed over recent years (Statistics taken from the Australian Bureau of Statistics Website: www.abs.gov.au):
- There has been a steady decline in marriages over the past decade.
- There has been a steady increase in de facto marriages, which accounted for 12% of all persons living as a socially married couple in 2001, an increase of 28% since the 1996 Census.
- Most couples cohabit prior to marriage, with 73% living together before marriage.
- 37,800 couples reporting as de facto same-sex couples.
- Children are present in 11% of same-sex married households.
- Since 1985 divorces have increased by 31.6% in Australia.
- 49.8% of divorces in 2005 involved children under the age of 18 years.
- Of the grooms and brides remarrying in 2004, 30% had children under 16 years from a previous marriage.
Estate Planning Implications
For most people estate planning is about having peace of mind about what will happen when they die or if they become incapacitated. Many who are in blended families with their second or third spouse are often at pains to ensure that children of a first marriage are provided for, while being determined to ensure that the prior spouse can’t get their hands on any more money than they got the first time around.
Much of what will be involved in preparing an estate plan for clients in blended families will be to ensure a distribution of the assets with a view to minimising or avoiding potential family provision or other claims being made by people who might have an expectation of benefiting from the will maker.
In the next article I will provide an overview of some estate planning strategies in the context of blended families, future relationship breakdown, and remarriage. This will prove useful as you consider your own family situation, your asset structure, and what gifts you may want to make.
In the meantime, if you are in a blended family and do not have a Will that is just right for you and your circumstances, you should consider making an appointment with Kenny Spring Solicitors to discuss your individual needs. For more information contact Patrick Coetsee on ph: 02 6331 2911.