Starting a new relationship or rebuilding after separation is exciting but can bring a level of complexity when it comes to your finances. With the right conversations and planning, you can protect your wealth and set yourselves up for a secure future together.
Let’s talk money
Money conversations can feel awkward, but they’re essential for building trust and avoiding misunderstandings. If you’re moving in together or sharing expenses, be clear about who pays for what. There’s no right or wrong way to split costs, but misunderstandings can arise if assumptions are made.
Being open about debts, spending habits, and financial goals from the beginning helps build trust and clarity.
Merging finances too quickly can create challenges. Combining bank accounts or buying property together early on can be hard to unwind if things don’t work out. Maintaining some financial independence, such as a separate bank account, even when sharing expenses, gives both partners autonomy and a safety net.
Protecting your legacy
If you have children from previous relationships, or you’re building a blended family, it’s important to think about how your assets will be passed on upon your death.
Jointly held property usually goes straight to your partner if you pass away, however you might intend for it to be passed to your children.
Superannuation death benefit nominations are often overlooked, so regularly review and update them to ensure your wishes are honoured. Leaving your super to a partner can be more tax-effective than leaving it to adult children, who may face a higher tax rate.
Binding financial agreements: Clarity for both partners
Binding Financial Agreements (commonly referred to as prenups) can be made before, during, or after a relationship, and both parties must seek independent legal advice for the agreement to be enforceable.
They aren’t necessary for everyone but can be valuable in certain circumstances. If one or both partners are bringing significant assets into the relationship, have children from previous relationships, or are involved in a family business, then a prenup can provide clarity and protection.
These agreements can outline how assets will be divided, protect future earnings, and specify spousal support. It can safeguard specific assets such as family businesses, inheritances, investment properties, superannuation entitlements, and intellectual property.
Knowledge is power
If you’re uncertain about your financial position, face it head-on and seek clarity. When both partners understand each other’s financial situation, you can make informed decisions and avoid future disputes.
Those who’ve been through divorce often approach new relationships with more caution. If you’ve experienced financial abuse or control in the past, it’s especially important to set clear boundaries and seek support.
Having honest discussions about your finances, supported by guidance from a qualified adviser, gives you and your partner the confidence to build a strong and secure future together.
Healthy habits for stronger relationships
Finally, maintaining healthy financial habits can strengthen relationships over time. Set joint goals, review your budget regularly, and agree on a threshold for big purchases to stay aligned and avoid conflict. Open communication and shared planning are key to building a financially resilient partnership.
Seek advice from a qualified financial adviser or lawyer before making major decisions, especially regarding property, superannuation, or Binding Financial Agreements to help avoid costly mistakes and ensure any arrangements are legally sound.
Prue Cheeseman-Goodes is an adviser of HLB Mann Judd Wealth Management (NSW) Pty Ltd (AFSL 526052). This content contains general advice which does not consider your particular circumstances.
You should seek advice from HLB Mann Judd Wealth Management (NSW) who can consider if the strategies and products are right for you. Information based on historical performance is often not a reliable indicator of future performance. You should not rely solely on historical performance to make investment decisions.