According to recent figures from the Office for National Statistics, one in ten children in the UK are part of a step-family. Modern family life is more complex than ever, and financial issues can be complicated within step-families with multiple children from previous marriages. If you’re entering into a new relationship following a divorce, and welcoming step-children into your family, here are a few aspects to consider with your partner about making sure your finances are fair and balanced:
- Firstly, get in touch with your family lawyer or solicitor for advice on organising your finances, updating any wills or insurance policies, and drawing up a cohabitation agreement or prenuptial agreement with your new partner.
- Agree with your partner over whether you will be sharing bank accounts and savings, or whether you will keep your finances separate – or perhaps you plan on opening a joint account or ‘family fund’ in addition to personal accounts. Be clear about your finances from the start and consider what savings you need to make now that your family has grown.
- If you’re going to share the emotional and practical responsibility for each other’s children in your new ‘merged’ family, then it’s important to share financial responsibility too. Life in a step-family should be as fair as possible, and it’s your job as parents to help everyone feel included and looked after.
- Child maintenance, tax credits and child benefit payments will be reviewed and may be altered to take into account your new living situation. Report any changes to the appropriate agencies to avoid being over or underpaid.
- Remember that you may still be eligible for financial responsibilities from your previous relationship, such as child maintenance, mortgage payments, and insurance premiums etc. A detailed budget – taking into account both your personal and joint finances – can be useful to make a practical plan for the future.
- Bear in mind that step-children do not automatically have the right to inherit from step-parents – if you want to ensure they’re included in your inheritance then you will need to update your will, probate arrangements, and life insurance policies.
Managing your finances in a step-family can sometimes be confusing, but with some practical groundwork and a realistic view of the future, it’s possible to find a way to look after your new family and keep on top of your money situation.
For advice from a professional and experienced family law solicitor, speak to the team at Frances Lindsay & Co. We offer fixed-fee legal services across the Thames Valley, including prenuptial and cohabitation agreements, divorce, wills and probate, property and conveyancing. Get in touch and let us take the weight off your shoulders!
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