Over the past 30 years, more couples have remarried later in life. As people mix families, especially with children, there are financial pitfalls to avoid.
NORFOLK, Va. – Over the past 30 years, more and more couples have divorced and remarried later in life. This is a phenomenon that many call “gray remarriage”.
But, as people try to merge families, especially when children are involved, there can be financial pitfalls along the way.
When Cindy Mabie divorced, she didn’t know if she would find love again.
“There’s a part of you that’s like, ‘Okay, at this age, are you doing it again?'”
Hoping that she would meet her partner, she joined an online dating site.
“I was like, ‘Wow, that’s kinda overwhelming,'” she laughed.
Just when she was about to end her membership, she received a message from Pete.
“He was genuine, he was very sincere. A gentleman.”
They met in person in Virginia Beach, and soon after he proposed.
They planned two weddings, both of which had to be canceled due to COVID-19. So the two decided to run away to a ski slope with her four sons and two dogs.
“I feel 100% loved and cherished by him, and that feeling is something I can’t thank him enough for,” Mabie said.
Pete and Cindy aren’t the only couple to find love later in life.
The Pew Research Center reports that one in four divorces in the United States involves people over 50, and divorce rates have doubled in this demographic over the past 30 years.
Nearly 70% of people aged 55 to 64 remarry.
When it comes to bringing a family together, especially at an age when you’re financially well established, “money talks” can get tricky.
“We are beneficiaries, but we still have separate bank accounts,” Mabie explained.
While Cindy and Pete have a financial plan that works for them, many don’t.
Allison Dubreuil, director of financial planning at Wealthway, said that was a mistake.
“There might be pitfalls that you haven’t understood,” she warned.
She said her remarried clients either want to put all their money in one account or keep everything separate. She says there are pros and cons to both.
Putting your money in a joint account could potentially lead to a major problem down the line.
“What can happen if you don’t do your planning properly is that you can unintentionally disinherit children,” Dubreuil said.
She said if one of you died, all the money could go to your spouse, and they could do what they wanted with it.
On the other hand, Dubreuil said separating finances could lead to long-term health care issues.
“What if one of you needs full-time nursing care or home health care for an extended period of time, and that spouse uses up all of their money? Because the other spouse is responsible for supporting the partner in need of care.”
Dubreuil said that’s one of the reasons it’s essential to stay on top of your estate plan.
“It’s not necessarily a ‘set it and forget it.’ You need to stay on top of these things and review them at least once a year.”
She said working with a professional is important.
“We can make sure that we name the accounts correctly, we can use beneficiary designations, so that if there’s a certain asset that you want to bequeath to your child and not your spouse, that can easily be done with a beneficiary designation”, Dubreuil mentioned. “Then if you have enough assets and it’s warranted, a trust could be another tool.”
Whatever path you decide to take with your blended family, Dubreuil had three key tips: “Have a plan, be proactive, work with professionals, because you just don’t know what you don’t know.”
As for Cindy and Pete, with finances in order and love in the air for their first anniversary, they couldn’t be happier.
“I don’t want to spend my life with anyone else.”