How to Advise Clients Planning a Second Marriage

Kwok insists on discussing financial issues with both spouses in a second marriage at least once a year, she said, pointing out that can head off a lot of problems because it "reduces the stress between couples and reduces the potential for a financial conflict," which is "one of the primary source of marital discord and ultimately divorce again."

One common mistake that advisors often make is that they don't talk through the potential family implications of estate planning and other financial decisions, she said. Kwok will often meet with a couple to discuss a financial plan before they are remarried and before attorneys enter the picture, and the structure of the financial plans she helps clients create often goes into prenuptial agreements set up by attorneys, she noted.

Kwok strongly recommended that anybody remarrying enter into a prenuptial agreement, "especially when you have two sets of multi-generational families blending, or actually more getting mashed together later in life," she said. Although many people understand the "legal importance" of such agreements, the process involved to agree on a prenuptial agreement "has as much value as the agreement itself because it forces the couple to face and disclose and discuss often difficult and controversial issues, air out differences and work out how they're going to operate financially going forward," she told ThinkAdvisor.

Regardless, couples who are remarrying need to discuss multiple financial issues before a wedding to make sure both are on the same page about their financial resources, debts, obligations to family members, and expectations about spending, charity, gift-giving, retirement and more, she said, noting the many questions that need to be asked include: What will our lifestyle look like? Are we going to keep our houses? Are we going to move into one household together? What are the combined family finances? What are our combined assets? What do we want to keep separate, what's shared and what's joined? Where are we going to live? How are we going to budget? How are we going to spend money? Who's going to be paying the bills? How often do we review this together? And, if one person earns twice as much as the other person, are they going to contribute twice as much?

Kwok, as well as Dan Kern, who is chief investment officer for the 39-year-old TFC, have also witnessed the financial issues involved with remarriages firsthand, because each of them is in a second marriage. Kwok has been remarried for 11 years and "I practice what I preach," she told us, saying she and her spouse are "very compatible financially even though we have very different views about money and finance."

Engaged couples and newlyweds make some of the same mistakes as those remarrying. Although being on the same page financially is critical to a happy, long-lasting marriage, 72% of those recently surveyed by Northwestern Mutual and The Knot didn't have a clear plan when it came to saving for their passions and only 37% of them were talking about their finances monthly, ThinkAdvisor recently reported.

— Related on ThinkAdvisor:

• What the Nastiest Celebrity Estate Battles Can Teach Advisors
• How to Rescue Retirement When Older Clients Divorce
• How to Help Clients Through the 4 Stages of Major Life Transitions
• Broken Trusts: The Man Who Married His Wife Six Times