TGB's Jane Miller outlines seven important legal considerations for blended families.
TGB’s Jane Miller outlines seven important legal considerations for blended families.
Today’s family units come in various shapes and sizes, including step families (in which one or both partners have children from a previous relationship) and blended families (in which there are children from a previous relationship and children born from the current relationship). So, when there is “mine”, “your” and “ours”, what are the legal implications? And if you start a relationship with someone who has been married or in a de facto relationship before, even if there are no children, will that have an impact on your own assets?
Here are seven important legal considerations for blended families:
1. If you are intending to marry or enter a de facto relationship with someone who has been in a serious long term relationship before, consider what consequences this may have on your own financial well being. Has your partner resolved their financial issues with their ex by way of a binding property settlement? If they came to an agreement, discuss the benefits of taking steps to formalise that agreement with their ex. That way, any assets you acquire with your partner in the future cannot be claimed by the ex in the event he or she has a change of heart about the agreement. Likewise, if you are starting a new relationship after ending a serious long term relationship, formalise an agreement so it is legal and binding to protect your wealth in the future.
In most cases formalising an agreement for property settlement is a simple process, and a family lawyer will be able to advise you on this.
2. If your new spouse or de facto partner hasn’t yet reached an agreement for property settlement with his or her ex, then your financial affairs may be dragged into it, especially if they are acrimonious with each other. If your new spouse or partner has purchased an asset with you, then that asset will be considered in part an asset of your spouse/partner in the property settlement with the ex. If the property settlement needs to be determined by the Family Court, the Court will want disclosure about the income of the parties’ new partners or spouses. The Court can also adjust an entitlement for property settlement or spousal maintenance as a result of the financial circumstances of a new partner. For example, if the Court hears in a property settlement trial that the wife has remarried a wealthy man, then it is unlikely she would have a successful claim to spousal maintenance from her ex husband.
If a legally binding property settlement has not been reached, then there are risks associated with acquiring new assets and combining incomes in a step or blended family.
3. If you and your new partner/spouse have a child together, and one of you is paying Child Support to an ex partner for children from a previous relationship, then the birth of your child might decrease the amount to be paid. This is because the person paying Child Support now has another dependent to support. A lawyer or the Child Support Agency can provide further information on this.
4. If you or your new partner/ spouse receive Centrelink benefits and then form a new de facto relationship or marry, it is important to advise Centrelink of your new financial circumstances.
5. A significant change in your personal relationships warrants a review of your estate planning. If you remarry or repartner, then you need to prepare a fresh Will determining the division of your assets should you pass away. This can be somewhat complicated in step and blended families, and it is often difficult to balance the division of assets fairly between your spouse/ partner and the children from the previous relationships. Whilst it is tricky, an experience Estates lawyer will be able to advise you of your options and help put a valid legal Will in place. You should also consider preparing an Enduring Power of Attorney and Enduring Guardian to nominate who will make decisions for you should you not have capacity to do so.
6. If both you and your new partner/ spouse have children from previous relationships, then navigating this family dynamic can be tricky, especially if relations are strained with one or both of the exes. In some step families it is difficult to coordinate the children’s living arrangements with the other parents so that all the children in the blended family get to share some time together at home. If the children become close to one another, and the Court is asked to make a parenting order, the Court will want to know about the child’s relationship with step and half siblings and will consider the impact of the proposed order on those relationships. For other step families tensions run high between the various children, and some children express a wish to change their living arrangements to avoid spending as much time with step siblings.
7. Finally, as living in a step or blended family can be challenging, consider preparing a prenuptial agreement (known as a Binding Financial Agreement) early in the relationship. This will allow you and your partner to lay out at the start of your relationship how you will divide your assets should your relationship breakdown in the future. If possible, seek legal advice before you start living together or marry to understand your rights, obligations and options.