Navigating the mine field of the modern family
By Helen Kearney
NEW YORK (Reuters) - The complexities of modern families, which can often include children, stepchildren and an array of ex-husbands and ex-wives, can make financial advisers feel more like therapists.
Still, it is essential that they are equipped to handle -- and ready to discuss -- sensitive issues dealing with money and inheritance, and the passions that they can provoke.
"It's not exactly a shrink session, but (couples) are often talking about issues they've never discussed before," said Jane King, a Wellesley, Massachusetts-based adviser. "I have to play devil's advocate."
Clients often struggle with how to treat each child or stepchild fairly, which does not necessarily mean dividing assets equally. They must take into account money each child might receive from an ex-husband, wife or grandparents.
King said she helps clients by discussing her own situation as a stepmother to her husband's two children. She said she feels more money should be set aside for the child that she and her husband have together than for his other children as their mother also gives them money and much of their education has already been paid.
"It can be a shock for people to hear, but being fair does not always mean splitting everything equally," said King.
The two most important documents for an adviser to recommend for clients planning to remarry are a prenuptial agreement and an estate plan, say advisers. Continued...