You want to take the plunge and move forward with your new relationship but your children are worried about their (I mean, your) financial future if it doesn't all go to plan? Some simple planning can mean that you don't need to give up your own happiness or create tension in your relationship with your children; you can have it both ways.
Here are our top 3 tips to have your cake and eat it too:
- Know and record your assets and liabilities at the commencement of your relationship – make a statement of what you own and what it's worth. Obtain and securely retain documents showing the value of your assets at that point in time, such as: market appraisals of any property; recent share statements; a screenshot of bank balances; and your most recent superannuation statement.
- Be brave and have a conversation with your partner about your expectations as to how you will deal with your assets and liabilities during your relationship, and your attitudes about providing for your children or family during your lifetime and after your death. This can set a framework as to how your money is spent, and assets are held during the relationship.
- Demonstrate those expectations through your actions – this can be done by formally recording your intentions such as in a Binding Financial Agreement or Succession Act Deed; by holding assets as tenants-in-common; by entering into Deeds or Loan Agreements when you transact on your pre-relationship assets; and ensuring consistency between your Will and your actions during your lifetime.
Have the courage to discuss and address the warts while the relationship is young and rosy, so you can have your cake and eat it too.
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