Step by step: basics for advising blended families

When two families become one, encouraging full disclosure is key to a successful ‘marriage’ of financial values and assets.

Marriage vows and commitment promises are a great way for couples to make their feelings known to friends and family. But according to Ayal Fernando, director of Fern Financial, there’s something the newly engaged need to take care of privately, well before the celebrations start – especially if one or both partners are on their second or third trip down the aisle.

While the financial principles are the same as with first-time partnerships, the beginning can be more complex. So after checking personal compatibility, the key element to ensuring a durable merger is disclosure.

Fernando believes one of the biggest risks to newly blended families is when couples may not share their financial history that may impact the relationship.

“There’s a lot more baggage and history to work through, so it’s important to have that conversation early so that everyone’s across it.”

If financial history isn’t shared – especially ongoing or accrued debt – “it can have a huge knock-on effect on how things move forward,” he says.

Aligning money values

Fernando prefers advising couples together (perhaps following a brief one-on-one with each), which helps pave the way for ongoing open communications about their financial past and future.

He sees his role as “a third party who can act as a bit of a counsellor when it comes to money matters and moderate the situation” if necessary. His goal is to help couples reveal their financial goals and interests, and also determine their ‘money personality’.

“In my experience, one person is often the financial decision-maker in the household, but that doesn’t mean the other person shouldn’t be involved in the conversations,” he says. “It’s about making sure each person is across what the other wants to do, or what they feel is important. Like anything in a relationship, it involves compromise.”

Once couples in blended families have a handle on how they think about money, Fernando says taking care of the basics isn’t typically that different from any other couple.

Just remember to keep everything up-to-date. “I like to see my clients at least twice a year, because a lot can change in that time, especially with younger families.”

Blended basics

Estate planning

This is the area likely to cause the most tension, says Fernando.

Ensure wills, powers of attorney, and trusts are revised or that new ones are established to include newly combined family members.


Fernando says people can forget that super is a non-estate asset.

“Always review the nominated beneficiary, because if it’s an ex-partner, that’s who it will go to in most cases. There is potential to challenge, but it’s up to the discretion of the trustee of the fund,” he says.

Don’t forget to check other non-estate assets like insurance bonds or investment bonds, which may list beneficiaries, he adds.


Fernando believes the family home is a potential flash point, particularly for children and stepchildren. He says advisers can help couples choose different methods that can ensure a stable home for a surviving partner.

“One example is a ‘life interest’,” he says. “That means if one partner passes away the other has the right to live in that house for as long as they’re alive. Then when they pass away, the interest goes to the children as it was intended.”

Like what you see? Sign up for your monthly dose of financial advice insights and practical tips!

Important: This article has been prepared without taking account of the objectives, financial or taxation situation or needs of any particular individual. Before acting on the information, you should consider its appropriateness to your circumstances and if necessary, seek appropriate professional advice. Any information used in this article is for illustrative purposes only. Ayal Fernando is external and not a member of the Commonwealth Bank of Australia Group of Companies (the Group) and the content or any view expressed by Ayal Fernando does not represent an endorsement, recommendation, guarantee or advice in regard to any matter. CBA, nor members of the Group accept any liability for losses or damage arising from any reliance on external parties, their products, services and materials. Past performance is no guarantee of future performance.