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Blending families is a journey that brings new opportunities, challenges, and a shared future. Navigating finances in a blended family comes with a unique set of complexities requiring more nuanced approaches, such as a prenuptial agreement.
Prenups are unnecessary in most first marriages. That is according to Laurie Israel, a national prenuptial agreement mediator, consultant, lawyer, and author of “The Generous Prenup: How to Support Your Marriage and Avoid the Pitfalls.” She pointed out in this episode of the Modern Husbands Podcast that prenups are more often than not quite dangerous in a first marriage.
I asked Laurie if her typical anti-prenup position was the case for blended families. Laurie estimated that they make sense for about one-in-five second marriages.
In truth, a prenuptial agreement is not always a declaration of doubt or a lack of trust in a relationship, particularly in blended families. Rather, they can be a proactive step toward ensuring the well-being of both partners and their children in the event of unforeseen circumstances. Prenups can be a powerful tool for open communication, financial transparency, and the preservation of cherished family legacies.
It’s important for a prenup to have set rules that can help eliminate conflict between the surviving spouse and the children of the deceased spouse. Couples must consider the practicalities of a prenup that can safeguard both their love and their children.
Here are some of the main reasons why the parents in a blended family would create a prenup:
1. Protecting the interests of the children: A prenuptial agreement can ensure that each partner’s biological or adopted children are financially protected. A prenup can outline specific provisions regarding assets, inheritance and support in the event of a divorce or the death of one spouse. This clarity can prevent potential disputes and offer peace of mind to both partners and their children.
Says Israel: “Another benefit of a prenup for people remarrying is that if they have children, they can assure their children that they are considering them, and do not plan to disinherit them by remarrying. There are many horror stories about that. Most parents want to give their children a step up in life by helping them during their lives as well as after their deaths.”
2. Preserving family heirlooms and sentimental assets: Blended families often bring with them unique family heirlooms, sentimental possessions, or significant assets that hold deep emotional value. A prenup can establish clear guidelines on how these items will be handled in the event of a divorce or the passing of a spouse. This ensures cherished possessions are preserved for their children and future generations.
3. Safeguarding business interests: For couples who own businesses or have significant investments, a prenuptial agreement can be invaluable in protecting those assets. This can be especially important if one spouse enters the second marriage as an owner or partial owner to a family business. Prenups can outline the division of business interests or assets in the event of a separation, providing both partners with a clear understanding of their financial futures.
4. Significant disparity in wealth: It is not uncommon in second marriages for one spouse to enter the marriage with significantly more wealth than the other. This situation is accompanied by many other issues and requires creative and informed thinking to find sound solutions.
Most couples build and share marital assets throughout a marriage. These are usually divided in half if there is a divorce, and provided to the surviving spouse if the marriage ends in death. Financial security is generally an essential goal and feature of a marriage, especially as the marriage grows longer and the spouses grow older.
Says Israel: “Every prenup needs to foresee this eventuality. After all, everyone getting married is doing so with the aim of building a life together until death. If a prenup detracts from a party’s sense of (or actual) financial security, that party may feel less loved, which in turn can weaken the marriage.”
Also read: How yours and mine becomes ours: Navigating finances in blended families
