EPISODE OVERVIEW:

Second marriages bring more than love to the table, they come with financial history, family ties, and planning decisions that can’t be ignored. In this episode, Betty sits down with CPA and CFP® DeDe Smolen to unpack the financial, tax, and estate planning realities of blending lives later in life. From prenups and retirement accounts to protecting your children and navigating those sometimes-uncomfortable money talks, you’ll walk away with practical tools for building a financially transparent relationship, and a plan that works for both of you.

TIME STAMPS: 

[1:57] Why Second Marriages Are Different
Blending finances and families
Money baggage from previous relationships

[5:38] Common Financial Pitfalls
The importance of full transparency
Navigating children, college costs, and expectations

[8:42] Starting the Money Conversation
When to discuss finances in a relationship
Debt, credit reports, and financial compatibility

[12:24] Fair vs. Equal in Marriage
Why prenups can strengthen relationships
Setting expectations around assets and liabilities

[16:51] Tax Planning for Second Marriages
Marriage benefits and marriage penalties
IRMAA surcharges and tax surprises in retirement

[28:14] Legacy Planning Challenges
Supporting children while protecting your retirement
Special needs planning and inheritance decisions

[33:10] What Makes Second Marriages Successful
Balancing financial independence and shared resources
Creating transparency through financial tools and systems

[41:17] Top Advice for Couples Considering Remarriage
The importance of transparency and communication
Planning for the future together

[45:18] The One Thing Every Couple Should Know
Why transparency is directly linked to relationship success
Building trust through financial openness

KEY TAKEAWAYS:

• Transparency matters – Honest conversations about money, debt, assets, and expectations lay a stronger foundation for second marriages, even when those conversations aren’t easy
• There’s no one-size-fits-all approach to finances – Every couple has to figure out the right mix of separate and shared money that works for their relationship and their family
• Prenups aren’t just for the wealthy – A well-structured prenup clarifies expectations, protects children, and can actually reduce conflict down the road
• Estate planning is essential – After remarriage, beneficiary designations, trusts, wills, and powers of attorney all need a fresh look 
• Money conversations often reflect deeper values – Most financial disagreements come back to deeper questions of trust, security, fairness, and feeling heard
• Planning ahead creates peace of mind – Discussing retirement, long-term care, inheritance, and legacy goals early helps families avoid confusion and stress later
• Awareness reduces financial tension – A clear picture of household finances helps couples make decisions together with confidence instead of confusion
• Second marriages benefit from flexibility and compassion – Every blended family looks different, and the best financial plans leave room for patience, understanding, and a little grace

GUEST INFO: 

DeDe Smolen, Financial and Tax Planning for Second Marriages

• Website https://www.innovativefinancial.com 
• info@innovativefinancial.com
• 303-275-7170
• YouTube https://www.youtube.com/@DeDeTalksMoney
• Facebook https://www.facebook.com/search/top?q=innovative%20financial%2C%20llc

RESOURCES:

• Join Betty in a free consultation call for your financial goals
• Subscribe to the Betty’s Smart Friends YouTube Channel
• Follow us on Instagram
• Visit my website for more info
• Follow us on LinkedIn

Betty Wang is an investment adviser representative of BW Financial LLC, a registered investment adviser registered in the State of Colorado. Registration does not imply a certain level of skill or training. The views and opinions expressed are as of the date of publication and are subject to change. The content is for informational or educational purposes only, and is not intended as individualized investment advice. This information should not be relied upon as the sole factor in an investment-making decision. You are encouraged to consult with a financial professional to address your specific needs and circumstances.

TRANSCRIPTION:

Automatically Transcribed With Podsqueeze

Betty Wang 00:00:05 When love comes the second time. It usually comes with history, and that history often makes the financial side more complicated, not less. Welcome to Betty’s Smart Friends, where we explore the full picture of what true success really looks like, from money and relationships to personal growth and well-being. I’m Betty Wang, a certified financial planner. I help women navigate big life transitions and make confident decisions about their money. Today, we’re going to talk about the financial and tax planning challenges of second marriages, from blending families and protecting children, to balancing love and long term legacy. I’m so thrilled to welcome Deedee Smolin, formerly Jones of Innovative Financial. Daddy has been both a mentor and dear friend to me for almost ten years now. Beyond her credentials as a CPA and a CFP. d.d. brings more than 20 years of experience helping families navigate complex financial, tax and estate planning decisions with clarity and intention, especially when life doesn’t follow a traditional script. DD has also taken this transition personally as she got remarried in 2020.

Betty Wang 00:01:19 So this conversation is about asking better questions, making intentional decisions, and creating financial plans that support strong relationships and long term peace of mind. Please welcome Deedee to the podcast. Yay! Yay!

Deedee Smolin 00:01:34 Thank you. What a lovely intro. gosh, it’s over ten years since we’ve known each other. It’s been a treat.

Betty Wang 00:01:42 Yes. Getting. Yeah, it’s been a while. Well, tell our listeners a little bit about your background and how your experience as a CPA and a CFP shapes how you approach second marriages or planning for them.

Deedee Smolin 00:01:57 Well, and I would simply say I don’t even limit it to second marriages. Anytime two fully formed adults are trying to combine finances with or without the benefit of marriage, there’s a lot of questions to consider. There’s times when we don’t want people to get married for tax reasons, sometimes, sometimes for liability reasons. So really it’s the concept of how do you best plan that joining with or without marriage really integrated or keeping it fairly separate. And the finance aspects are huge, the tax aspects are huge as well.

Deedee Smolin 00:02:33 And then you protect all of that with appropriate estate planning.

Betty Wang 00:02:37 And why do you think I mean, yes, there’s always when we’re combining two families, two people from totally different money stories and backgrounds. you know, those are complicated. What do you see when it comes to second marriages? Why is it slightly more complicated or what kind of complexity do you see there?

Deedee Smolin 00:02:59 Sure. Well, one word it’s baggage. Because we all come with our experiences in the past. If you are divorced and you know money was an issue in the first marriage. Likely that baggage is coming with you. that that kind of thing or whatever helped you write your manuscript. It’s really key to acknowledge that everybody has their own money story and then look forward together rather than, you know, don’t we don’t want to be combative. We both want to look forward at the same time. And so helping couples talk about why it’s important that they have the combination, and that then can help clarify the choices that they make. How combined do they need to be? You know, is it a little bit is a lot.

Deedee Smolin 00:03:43 I’ve seen everything from we keep things totally separate till we do it like grandma and grandpa and absolutely everything is joint there. There’s no right or wrong answer. It’s what serves your why?

Betty Wang 00:03:54 Well, I think that’s where people. I mean, you’ve seen it too, in financial planning, and they think that there’s a right answer because they have pundits or financial news telling them if they don’t do this, yeah, they’re screwed. Right? And that’s just not the case. It’s such a continuum. And that’s where a financial planner or a professional comes in, right? To find to help you find where you are in that continuum.

Deedee Smolin 00:04:20 Right. And and facilitate the conversations of the pros and cons of those different places on the spectrum. You know, if it’s completely separate, what’s good about that and what’s not so good about it? or if it’s completely joint, what are the risks that you have and some families that the risks are going to be different in every situation. So, with all the couples I’ve worked with over the years, there haven’t been any two couples that had the exact same arrangement.

Deedee Smolin 00:04:45 They’ve looked at the different pieces carefully, individually, and made very thoughtful choices based on their situation. So it’s just a piece by piece. A lot of it, though, is so helpful in second marriages. You know, growing up, none of us are trained on how to talk about money. And if in your first marriage or single them or whatever it might be, you don’t learn those skills that second marriage because of the extra baggage, the potential for children, you know, whatever else is going on. Learning how to discuss money with your partner is so much more important because there’s more moving parts. And so this is building that foundation for that growth, for that success.

Betty Wang 00:05:28 Well, and sometimes there’s just more wealth to a second marriages.

Deedee Smolin 00:05:32 I was trying not to be crass, but yeah, yeah, yeah. There’s more to deal with. Absolutely.

Betty Wang 00:05:38 I’ll be crass. It’s fine. People are used to it. And what are common pitfalls or blind spots that you see? What are common? You know, I mean, I know everybody’s different, but I’m sure you know, what we care about is we want to protect, you know, each of our children from our previous marriages.

Betty Wang 00:05:57 Or there’s, you know, maybe a family home that’s been in their family for generations. They want to keep it. Bloodline. Only things like that. What what have you seen or what kind of blind spots?

Deedee Smolin 00:06:11 The number one mistake is not committing to full transparency. You know, put all the cards on the table. Let’s not have things just sit out and be ignored. Oh, yeah, we’ve got some company stock. But but understand, make sure everybody knows what that company’s stock is. The man I married, his wife’s family has a company, and so there’s ownership in this company that he has now inherited. And so we spent time learning about what the company is, how it works, and how he fits into it, because he’s got, you know, the a third share of that generation because of his deceased wife. So understand that stuff, that full transparency piece. And then beyond that, it gets very complicated when there’s children. So if you’ve got kids who haven’t gone through college, but you’re marrying somebody who’s kids are already done, there’s going to be some conflict about paying for that college because this person says, we’re already done.

Deedee Smolin 00:07:10 And this person goes, I’m not there yet. How do we balance that out? You know, and there’s different ways to do it, you know, does it come out of the joint bucket or do we set aside an amount so that it’s predictable or you know, and it it probably you’re negotiating with a an ex spouse on that too. So it’s it can be a three way negotiation of how to make that work. But it’s really underlying everything is talking with the important the important people, the the participants could be a conversation with the child. I got divorced the the filing was the day after my kids graduated high school, which tells you a little bit something about my ex. But at that point I sat them down and said, here’s what the resources are, here’s what we can do, and here’s what your choices are. You know, I knew what I could get from the ex. I knew what I had, and they went, okay, we’ll take that path. And it worked out.

Deedee Smolin 00:08:05 It might not have been, you know, the Ivy League education, although neither of them were really set on that. But it it set expectations. And really that helps so much when people can know what to expect. They can act on that information. And it just really keeps the calm.

Betty Wang 00:08:22 With your clients or people you work with. How do you how do you recommend approaching that conversation? And when I guess when I mean, most people don’t, they think about the love first, right? They think about we’re going to get married, and then maybe the money and the assets are a secondary piece of it.

Deedee Smolin 00:08:42 It very much is because we want to follow our hearts. And I want to honor that, too. That’s that. That’s the human experience. But but if we can keep the finances behaving in a good way, not introducing stress or conflict, it supports your heart. And so that’s my goal. I would say globally, sooner rather than later. Let’s start talking about it. Like when I was dating my husband.

Deedee Smolin 00:09:06 We were really quiet about finances for a good long time, a year or two. And then finally one day we he shared his balance sheet. I shared mine because neither of us wanted to be the purse. Right. You want to make sure that there’s some parity. Now that’s not necessarily required. But that was those were values that we held is we wanted a partnership in the truest sense.

Betty Wang 00:09:28 And so I mean I would love if we for dating sites, if they could do a credit report for my clients. And then and.

Deedee Smolin 00:09:36 I can see that happening in the future. That that’d be yeah I, I don’t need to know how much you make, but I want to make sure you’re not a deadbeat.

Betty Wang 00:09:44 No, I want to make sure you pay your bills and you don’t. Oh, I might.

Deedee Smolin 00:09:49 Just be your girlfriend. Yeah, and I might want to know if you have school loans, because that could impact whether I want to marry you. Because a lot of school loans, once you get married, you then become a co borrower.

Deedee Smolin 00:10:00 So just something to consider. Not all loans have that. so you have to look at the loan to see. But that can be a condition of the loans. And so I have met with folks and they went yep. We’re going to hold off on getting married until that school loan debt is done. Like that’s that’s interesting. That tells me there was more going on in that relationship. But, it’s eyes wide open when you get married. You know, it’s for better or for worse. Well, it’s for the richer, for poorer, for whatever debts you are bringing in, for whatever, you know, and all the all the fun family stuff, too. So it’s you’re you’re joining up with all, all sorts of variables.

Betty Wang 00:10:38 Well, I mean, the reality is that the a majority of divorce are a big factor of it is people clash over money. It’s what couples fight over the most. So we we want to get clear on that.

Deedee Smolin 00:10:53 And I think a lot of money fights are cover for fights where over something deeper.

Deedee Smolin 00:11:00 So things so values that actually aren’t shared. And so money is easy because you can quantify it. But really the conflict is even deeper than that, which makes us helping with the money that much more important, because that’s going to be representative of whatever baggage people are bringing in. So having those deep conversations with clients can really, really help their marriages be more successful if done well.

Betty Wang 00:11:22 What have you seen in your experience? Do you? What are red flags? If somebody hears their partner say, this is all I have. How do you how do you trust that? Like how do you how do you know if they’re being transparent?

Deedee Smolin 00:11:36 Oh.

Betty Wang 00:11:37 Do you have have you had any experiences where you’re like, oh.

Deedee Smolin 00:11:40 I haven’t had a lot of experiences for lack of transparency in the straight up hiding of assets. But I have seen situations where people go, yeah, it’s over there and just Pooh Pooh it. Like, we don’t need to include that. Or it can even be, you know, family trusts that have assets but have restrictions on them or even potential inheritances.

Deedee Smolin 00:12:03 And so they just for, for whatever their family dynamic is, that’s not a comfortable topic for them to discuss. And so we try and bring it up at a level that’s comfortable. So it slowly get everybody on the same page. You know it might not be an asset anybody can do anything about. But awareness is super helpful.

Betty Wang 00:12:24 What do you say to clients who say, we just want to split everything fairly?

Deedee Smolin 00:12:28 If anybody who’s parent to more than one child is familiar with the difference between equal and equitable right, and that’s the same thing in a marriage. You know, if you’ve got people coming in with wealth and no wealth coming in together, they know this. I mean, hopefully this is where a prenup can be absolutely fantastic. So a prenup is not divorce planning. It is really good financial planning. In fact, it can actually solidify the strength of a marriage because you’ve taken the time to lay out what your expectations are. Nobody is doing, you know, behind the scenes deals.

Deedee Smolin 00:13:02 You know, exactly what what’s going on for everybody. What did the assets weather, the expectations? What are the liabilities? So really it’s it’s all conversational getting it to where everybody knows what’s out there and what to do about it.

Betty Wang 00:13:17 So ideally let’s say two people are considering marriage. Second marriage. Should they be contacting their financial advisor first or an attorney first or.

Deedee Smolin 00:13:28 Well, well I’m biased. I think working with the financial advisor first can be super helpful if if in a complicated situation. I’m not saying for everybody, you know, maybe, maybe somebody owns a business, somebody else has a family trust. And there’s moving parts that are complicated. Working with a financial advisor, you can get a better understanding of of the value of them. Sometimes things are hard to value. How they might cash flow, how it might impact taxes, etc. that you can then take to an attorney and create a prenup. And by the way, if you do a prenup, each party needs their own attorney to be properly represented.

Deedee Smolin 00:14:05 That doesn’t always happen, but that’s ideal. And then subsequently, as you do estate planning, you have a great foundation of the elements of the household wealth. So planners first.

Betty Wang 00:14:18 Always.

Deedee Smolin 00:14:19 I know, I know, but I’ve been doing this for a long time, and I’ve seen prenup where financial advisors weren’t considered and they aren’t as elegant as I would like to see. They can sometimes make things hard.

Betty Wang 00:14:32 Can you give an example of that without.

Deedee Smolin 00:14:35 Yeah. So there was a prenup that said this account. No, this holding in this account is for my kids as we get married. And it tied this person’s IRA into a, you know, a Wellington mutual fund, to the point that because of how it was written, we couldn’t rebalance. And so we got written permission from everybody that we could then go in and rebalance. But it was an interesting way to write it. I would never have said, you have to have this particular holding. I would say, you know, x percent of this account or the whole account or divvied up and make it its own account separately.

Deedee Smolin 00:15:12 So that’s that’s one thing I saw that was glaring from a financial planning standpoint.

Betty Wang 00:15:17 And for our listeners who aren’t in the industry, could you explain to them what rebalancing is and why it’s important?

Deedee Smolin 00:15:24 So basically what what the, what this agreement said was you have to imagine own ABC stock. So the ABC stock is what is going to go to my kids. And as time went on, the portfolio for this family had too much of whatever flavor ABC stock was, and we needed to reduce that holding and move it into, you know, maybe bonds or something to balance things out. But because of the prenup, we were precluded from doing that without involving an attorney. And so eventually they’ve removed that from the prenup that was agreed with everybody. And it was all okay. But rebalancing means we want to make sure that your investments are set up in a way that’s consistent with your risk tolerance and risk goals, and that was making it to where we couldn’t do that.

Betty Wang 00:16:17 Your hands were tied.

Deedee Smolin 00:16:18 Yep, yep.

Deedee Smolin 00:16:19 We’ll put.

Multiple Speakers 00:16:21 Hi listeners. Hope you are laughing and learning from this episode of Betty’s Smart Friends. Here’s a quick tip. Maintain an emergency fund. No matter how much you earn. Having a financial cushion or an oh, shit. Fund is key. Try to save 6 to 8 months worth of living expenses in a liquid, easily accessible account for the times that life unexpectedly punches you in the face. Thanks for being a listener. Now back to the show.

Betty Wang 00:16:51 You brought up the tax planning piece of it. What are couples most surprised about with the tax planning? when combining assets and retirement accounts, especially retirement accounts and second marriages. Right? Like, arguably would be larger than people who are going into it earlier.

Deedee Smolin 00:17:09 So the tax code has numerous features that change depending on if you’re single or married, some exclusively.

Betty Wang 00:17:17 About ten years. Yeah. No, no.

Deedee Smolin 00:17:20 You know, I’ve been a CPA for longer than I’m going to admit to on camera. And starting in 1986, it’s just been bonkers of changes, constant changes.

Deedee Smolin 00:17:30 You know, the one thing we know is that change is constant. So but in the tax code they try and make it so there’s not a marriage benefit or a marriage penalty. They try and make it marriage neutral, but they screw it up every time. Always. Yeah. And so there are some elements in families that get better treatment if you are single. And sometimes there are elements that get better treatment if you’re married. And so it it’s really great if you’re working with a financial advisor, a CPA at that point to say, all right, here’s what our tax returns are. What if we combine and you know, so getting married is one outcome. Getting married and filing separate is a different outcome. So we can look at all three scenarios. Generally married filing separate doesn’t no favors to anybody. very very rarely used. Most of the time we see benefits when we when couples get married, but not always. So you could have folks who are over 65 and on Medicare. And if they have the disparity in earnings.

Deedee Smolin 00:18:28 This person is not paying an Erma surcharge, but this one is they get married and now they’re both paying the Erma surcharge. And for those of you who don’t know Erma surcharge, that is that extra special tax they levy on folks in retirement whose income is higher than certain thresholds to pay toward their Medicare. It’s basically a ways to make Medicare means tested.

Betty Wang 00:18:51 Yes, I think a lot of folks who aren’t in the financial world, they get surprised by the Erma tax. So it’s important to know that.

Deedee Smolin 00:19:01 Oh, yes. Yeah. All the time. Yeah. We’re talking about it a lot more. So that same disparity after age 65, you might have heard of the widow’s penalty that, you know, when you’re in your older years, you’ve got two people and then one of them passes and all of a sudden that survivor is paying a lot more tax. When you get married, the widow’s penalty can go away. So it goes both directions. It really depends on where the starting point is for the family.

Deedee Smolin 00:19:28 So we watch out for the Irma. We watch out for the widow, widow and widower penalty, by the way, not a penalty so much as you’ve just gone from married filing joint to single. And if your income doesn’t change much, that pushes you higher in the tax brackets.

Betty Wang 00:19:43 So and what other changes do you see. You know there’s Social Security, there’s RMDs. You kind of alluded to the RMDs with the with the widow’s tax or even planning for step ups. Right. In case somebody passes.

Deedee Smolin 00:19:58 Yeah. So step up or like way in the future. You know, what does that estate planning look like. But even prior to retirement, the things we watch for are beneficiaries on accounts and making sure you get your wills updated and probably looking at a trust if you have any complexity in your world at all, making sure that those assets pass the way you intend, which points right back. How do you take care of the. The children. The children from previous relationships that is probably the thorniest topic for couples is, well, I only have one kid and you have two.

Deedee Smolin 00:20:35 Why should we split things a third, a third, a third and the what? The parent of the single child. What’s their relationship with the other children? If it’s all been one big happy family, maybe that feels okay if they married later enough in life that the relationships are really more as adults, not really as raising children, etc. the A case could be made for half a quarter a quarter depending on how the assets are, you know, or if this person with the multiple children had a bigger wealth, then you can adjust those percentages again. But it you know, what are the assets? Who brought what into the marriage? Who are the potential heirs. You can slice and dice that any way you decide, but you have to sit down and talk about it.

Betty Wang 00:21:18 And I think just for the listeners benefit. Not everybody realizes that beneficiary designations supersede their will. So that’s why it’s always really important to make sure that those are updated the way you want, because it’s happened. We’ve seen it in the news where somebody passes and they still have their ex-wife or ex-husband as their beneficiary, and that’s really hard to claw back.

Deedee Smolin 00:21:47 And those beneficiaries happen in life insurance. They happen in annuities. They happen in retirement accounts. Those are the big three that we look at. And we can in Colorado here we can do beneficiary deeds on homes. So that one that’s not a big three, but it’s one to consider as well. So if you’ve been single a while and you designated your kids as beneficiary on the home, that might need to change, you might need to add the spouse, add additional people as beneficiaries, etc..

Betty Wang 00:22:15 Can you talk a little bit about how Social Security works when you have gotten remarried, because it is, especially if you had a longer first marriage to.

Deedee Smolin 00:22:24 The first rule that comes to mind is if you’ve been married for ten years or longer, come. Time to file for Social Security. You are eligible for the larger benefit of your own benefit of your own earned benefits, or that of your ex spouse if you haven’t remarried. So that’s rule number one. If you’re a widow, you can apply as early as age 60 for benefits if you haven’t remarried.

Deedee Smolin 00:22:49 So those are two things that impact marriage. In fact, I’ve dealt with folks in that age range and said, you know, if you’ll wait a year, you can get this other benefit even though you get remarried. So there’s some remarriage dates to be sensitive to. But once you remarry, then your benefits are just like other any married folks. Whoever had, you know, you get your own insurance, and if it’s less than half of your spouses, they bump it up to be half of the spouse. Male or female, it’s indifferent there.

Betty Wang 00:23:23 So your ex spouse is no longer. You can no longer take from them once you’re married after their age.

Deedee Smolin 00:23:31 What if you get remarried prior to those cutoff dates? Then that that option disappears.

Betty Wang 00:23:37 And what tools? You talked a little bit about trust. What are. And I know you’re not an estate planner or you’re not an attorney, but you know enough just generally speaking, where do you where have you seen it use that’s been useful.

Deedee Smolin 00:23:52 At the end of the day.

Deedee Smolin 00:23:53 All of those documents are communication documents. Here’s what I want to happen. So where might the communication go? Sideways. So the prenup is if you’ve got some complexities or you just want to make sure everybody’s protected. That’s where the prenup ups are super handy. Far fewer people use prenup than would benefit from them. In other words, there’s a whole lot of people who if they did that, they would be very, very well served and then trusts her wills. Now each person’s situation, depending on where they live and what their assets are. Different choices. But having those set up is the gift to the next generation. Now, we don’t like hearing about stories where kids get disinherited, but that’s where that can happen. So keeping that line of communication open with the next generation is is very helpful.

Betty Wang 00:24:38 Yeah, I mean, I’m I’ve seen it I’m sure you’ve seen it. It’s it’s bad.

Deedee Smolin 00:24:43 I have and sometimes very deliberate and sometimes accidental. And I’ve also seen the opposite where people got remarried and made verbal commitment to the new spouse to at least leave them something, but never got around to changing beneficiaries.

Deedee Smolin 00:24:58 And so the new spouse got left high and dry. So it isn’t one way it can. It can backfire in any number of directions.

Betty Wang 00:25:05 What about post snubs? Have you seen more use of that?

Deedee Smolin 00:25:09 I’ve only seen 1 or 2 actually. Very very little. There’s some. What? I don’t know if it’s argument, you know, whether or not they’re enforceable. You know, it’s it’s more questionable in terms of enforceability versus a prenup where it’s happened before the event and everybody had representation. The post ups sometimes or, you know, you’re closing the barn door after the horse got out. Does it really do anything? Yeah.

Betty Wang 00:25:35 and then we talked a little bit about the family dynamics and communications. Like what? How do you how do you recommend sort of tiptoeing your way into these conversations? I mean, I’m kind of a blunt instrument, but I share that there are some folks that are much smoother. Or maybe you have questions that you generally ask to kind of, open the door a little bit, or if someone wants to start that conversation themselves, but they’re nervous to start it.

Betty Wang 00:26:09 I mean, it’s how do you have certain questions that are a good way to lead to these discussions?

Deedee Smolin 00:26:16 I think one of the phrases I’ve used in the past is helping people think about what’s the for US money and what’s the for our children money.

Betty Wang 00:26:24 That’s a great way to think about it. Yeah.

Deedee Smolin 00:26:27 because it’s it’s non-judgmental. And when you, you know, who doesn’t want to support the children. Right. And so it helps diffuse as opposed to your money grubbing or something, heaven forbid, says, all right. How do we take care of us? How do we take care of the next generation? And that’s that’s where I’ve started. And it’s worked out quite nice. one of the biggest things that I run into when talking with families about their children is their philosophy around funding college, and it too has that huge gradation. We’re going to pay nothing. We’re going to pay everything all the way through. If they want to be an MD, you know, and something in between helping families communicate with the spouses what their philosophy is and then coaching them how to communicate with the kids.

Deedee Smolin 00:27:12 Starting earlier than you think. Setting expectations of what will be expected from the future college students. So that’s a big piece is really understanding what is the college funding philosophy? I could write a book on that one, I’m sure.

Betty Wang 00:27:28 well, Ron Lieber, is it? Lieber. Yeah. Ron Lieber from The New York Times wrote a book about how to pay for college that I thought was really good.

Deedee Smolin 00:27:36 Well, how Do Pay is cool, but really what your family philosophy is that next level.

Betty Wang 00:27:40 Well, that he goes through that, that’s part of that. That’s even before you start thinking about it. And especially coming from different, you know, two different parents coming from different backgrounds. And then when you have, you know, say two marriages, you know, basically four people in this conversation that that can get complicated.

Deedee Smolin 00:28:03 Right, right. Right, right. Yeah. So that’s that’s the big one. And that’s a conversation I have with every couple, but it’s more complicated when it’s, you know, blended families.

Betty Wang 00:28:14 What about legacy planning? I mean, I could see how. College planning is a hard topic, but legacy planning is also, you you had alluded to it as well. The for us and for our kids.

Deedee Smolin 00:28:31 Well, the first gift is to make sure you leave enough money for yourselves so you don’t become a burden to your children.

Betty Wang 00:28:37 Right. Yes. Amen.

Deedee Smolin 00:28:40 Right, right. So, seriously, I have a client who did that who was so generous with her children, she impoverished herself and is now dependent on the charity of her kids. That family it’s worked out for. They’re all happy. I’m happy for her. But from a nuts and bolts spreadsheet answer, it was disconcerting to watch. Not normal. Most folks have a self-preservation instinct.

Betty Wang 00:29:06 Yeah. Yeah. That would make me very nervous. Yes.

Deedee Smolin 00:29:09 Yeah I know. So that one was probably.

Betty Wang 00:29:11 I’m glad that worked out for her.

Deedee Smolin 00:29:13 It. Yeah. That one. You know I. Yes. Yeah, exactly. That’s that’s what I have to hang my hat on.

Deedee Smolin 00:29:21 Is it did work out for her. That strategy worked. But yeah, the legacy question is complicated. Especially. So imagine one of those children is special needs. Then you just ten times the complexity. How do you take care of these kids? maybe you have one child who’s very, you know, success driven, took out big school loans. The other one’s perhaps more artistic and very comfortable with a lower standard of living. How do you make the estate equal for them? You know, somebody goes, I need help with my loans. The other one’s like, hey, kind of whatever, but, you know, please don’t cut me out. What do you do? So that on your passing, you, you know, there are not people cursing you. So again, it’s a conversation. And oftentimes including those beneficiaries in the conversation can help you achieve clarity because it could be the one kid goes, you know, I really don’t care if it’s 75, 25 or whatever. That’s totally groovy with me.

Deedee Smolin 00:30:21 Then you can make that decision confidently and with clarity. So special needs kids. That’s when you know, the attorneys that we know out there need to step in and set up the appropriate trust so that they’re taken care of, because much like we want to make sure that we keep our money and we take care of ourselves and don’t become a burden, we want to make sure that that special needs sibling is taken care of, and doesn’t become a familial burden to the siblings or nieces and nephews.

Betty Wang 00:30:49 And then how does. I mean, what have you seen that’s worked when it comes to, you know, long term when it comes to aging in long term care and those sorts of conversations? I mean, that’s not legacy per se, but it is. It is an important piece of our clients lives.

Deedee Smolin 00:31:10 It’s an undeniable piece. We can’t avoid it. There’s you know, the odds are most of us will be in an assisted living facility for some period of our life. Most of us hope that it isn’t a very long period of our lives.

Deedee Smolin 00:31:25 Right? So with that said, if people are young enough, we want to look at hedging that and buying insurance. And if you’re getting married, there are policies out there that can be purchased, for two people. So it’s a bundle of insurance that goes across to people that can be more affordable. I’m not a specialist in insurance, so that’s as much as I will say there, but it’s definitely something worth looking into prior to age 60. After age 60, the insurance options are, very expensive. And frankly, when I talk about that kind of insurance, I call it a portfolio protection, because what you’re doing is protecting that portfolio for the person who isn’t in care and, you know, preserving those assets for them. And so the the planning is, again, how do we take care of the these people so that they don’t become a burden on their children and that can impact perhaps their spending plan, making sure that they don’t spend so much that should the day come, they need care.

Deedee Smolin 00:32:27 There aren’t enough resources. It could be just philosophically thinking about it. It could be as simple as moving to a different house. That’s more age and place appropriate. So this is probably one of my soapbox topics. But think about what your future self are you going to be comfortable carrying the laundry up and down the stairs? Is it going to be okay to scrape the car off in the winter? What what kinds of things, when you’re the 75 or 85 year old self, might be difficult or might even be dangerous. Make those changes so that that would be my advice. Unrelated to combining families, anybody? Think about making your living space as age friendly as possible.

Betty Wang 00:33:10 In general, what have you seen with, you know, your client base or personally? Probably not the right word, but where have you seen the most success when combining? I mean, of course there’s the honesty, but is there is in second marriages, you see that it’s better or it’s more successful if clients, if each partner keeps their own assets and pays into one bucket, I mean, that’s much more common now with younger couples as well.

Deedee Smolin 00:33:47 Yeah it is. I think everybody needs access to money, but they can spend without supervision completely because we’re grown up adults. Right. And so negotiating an allowance, which is a horrible but you know, just saying, look, this is how much I’m going to, you know, we will slide this much into your bucket, this much into your bucket. The rest of it we keep combined as a family resource and then get clarity on who pays for what, you know, does going out to dinner come from his hers or ours? Yours? Mine or ours to. Yeah. So conversations around that makes a lot of sense. You know, our parents had fully joint stuff, so that wasn’t an issue. But you lose autonomy when you don’t give people some spending money that is unsupervised. I think. I think that’s important that people have access to that. The bigger thing that I think leads to success is awareness. So you can give money your energy or you can give money your attention. And giving it your energy sort of is like spinning and not getting anywhere.

Deedee Smolin 00:34:49 But giving it attention means you can be deliberate about it, acknowledge it and move on. And the tools over the years. Something like we have an app through e-money that people can do that with. You can use monarch money. There’s a lot of tools, but linking all of your finances into a single place that has everything. Full disclosure and you can see what’s going on. You can look, if you’re somebody who needs to look more often, you can. If you’re somebody who’s happy to ignore it, you can do that too. But knowing that it’s there has been one of the most successful moves I’ve seen in second marriages is just so that just so they know what isn’t, it isn’t tactical, it isn’t a huge planning. It’s just, oh that’s it. Oh good. I can relax and move on. So having a place where everybody can see the full picture at any time, that’s the key I think.

Betty Wang 00:35:41 What about when you have a big disparity in financial wealth coming into the second marriage? I mean, I guess what are your recommendations for the person coming in with less wealth versus I mean, I know we’re working as a team, but you know what? What are you what are you advising on? Both of them.

Betty Wang 00:36:03 Right. Because our job is to give them the pros and cons of different things. Like what are you talking to them about?

Deedee Smolin 00:36:10 Right. Well, it isn’t just an income disparity, but it’s a power disparity too. Because in our culture, money is power. So it I think, you know, premarital counseling in that situation wouldn’t be amiss. Or sometimes you can have one partner that’s retired and the other one’s still working. And so that can be interesting. And, you know, passive incomes, you know, who has a who has a pension, who doesn’t deferred comp, that kind of thing. And a lot of times the person who earns more money unintentionally dominates the money conversation. They don’t mean to you. They’re just, well, they have more money. So they, they things, they they shift things. And so that brings us back to that equal versus equitable Topic, you know, equal would mean you would have one person who, you know, lives like a little church mouse, and that probably isn’t the intention of anybody.

Deedee Smolin 00:37:01 The other the partner has largesse, if you will, negotiating. That’s where having the here’s a bucket to spend on, you know, unsupervised can really help. Now they don’t have to be the same amount. It kind of depends. You know what your hobby. If your hobby is needlepoint, that’s a whole lot different than if your hobby is, you know, refurbishing Rolls-Royces or something. You know, they could be different, but you can adjust it to the interests and the equity ability in the partnership. But it’s important, you know, defining that discretionary spending autonomy for each partner is the key. So don’t use math as an equation for emotions. So what are the emotions. What’s important. What’s going to feel right. And then set up a system that supports that feeling.

Betty Wang 00:37:49 What about clients who are maybe seven years, five, seven years away from retirement, or 5 to 10 years, right, where they’re still accumulating. How do you go about that conversation? Right. Do you still approach it the same way? what if one partner has a lot saved for retirement and the other one doesn’t? Those are awkward and hard conversations to have.

Betty Wang 00:38:16 How do you how do you approach that?

Deedee Smolin 00:38:19 Well, it starts with finding out. How is it you got here? You know, I you know, there’s a there’s a big difference. Oh, well she had stock options that exploded. That’s what happened there. Pretty much were the same has happened sometimes it’s like well because my job had better match I saved a lot more. And so we spent less out of the other person’s paycheck can be equal. And sometimes it’s just like, I didn’t feel like it. You know, that’s where it gets difficult when you have some somebody who is indifferent about participating in the marriage, in which case that’s a marriage counselor situation. not so much a planning situation, but but at the tail end of things, we want to make sure that the unit is going to be successful. You know, again, it’s always the hardest time is any time we have to, you know, disparate, disparate levels of wealth. Right. Coming in, be it cash flow, be it resources, helping people negotiate, that is far more difficult than when there’s, equality.

Deedee Smolin 00:39:21 Alternatively, I have some very, very old clients where the wife would stay at home the entire time and you just have a single decision maker. Interestingly, those folks are really good with 50/50 because there was never any power. You know, the power imbalance was set. Forget. And they’re like 5050. This is where we are. So it’s it’s that gray area in between. And I think, you know, we as a culture, we’re still working through how to make that work. And then it boils down to individual cases of how do we help everybody feel validated in the relationship? How do we manage the money in such a way that it helps that family be successful over time?

Betty Wang 00:40:00 Can you talk about a success story that you’ve worked with? I mean, I’m sure there’s a lot of them.

Deedee Smolin 00:40:06 For the one where we had the restrictive prenup, this couple, they got married and in their mid 60s there, there might they’re might poster children. And they had very different levels of wealth. Hers was not shabby.

Deedee Smolin 00:40:19 But his was like okay, very much. And he wanted to protect his kids. And so they created that prenup. And let’s see, we are ten years into working with them. And at this point they sound much more like the very elderly couple that I spoke to you with. Yet at this point, it feels like very good 5050. All of their children get along much better. They’ve updated the prenup. They’ve updated their trusts to recognize the more cohesiveness of their family. And so that’s that’s really cool that as over as time went on, the differences between them just merged and they’ve melded nicely.

Multiple Speakers 00:40:59 That’s a nice story.

Deedee Smolin 00:41:00 Yep. It is. Yeah. I wish I had more to do with it. It’s just they’re absolutely fantastic people. They’ve done a great job.

Betty Wang 00:41:07 So if somebody listening today is considering second marriage, what what do you think their top two steps that they should take right now.

Deedee Smolin 00:41:17 Well first is transparency. Just make sure that you each know all the stuff about the other.

Deedee Smolin 00:41:23 Some of that’s financial, some of it’s maybe family history. You know certainly you know or family dynamics understanding what you’re getting into. Not nothing is don’t do it but just know what it is. That’s really, really the number one and number two thing in my world. What am I missing? What would you do differently, Betty. What would you ask?

Betty Wang 00:41:44 I mean, I think it is just starting. With what exactly? What you said, right? It’s. We need to know where each of you are at, where you want to go and how they see it happening, and what the pros and cons of that is. And again, trying to find where they are on the continuum. And just for that it’s facilitating the conversation because they they get to that themselves. I feel like and having a non-judgmental space that is open for them. Right. I think we’ve talked about this before. We’re talking about money is normalized, right? It’s not this. I have this, you have that right? I can.

Betty Wang 00:42:28 It’s more okay. These are the facts. Let’s let’s talk about what makes sense. But I really like the way you you put it as the. What’s for us? What’s for our kids. What are kind of hot points for for us, right? Like we all as we hopefully age and become more self-aware. We know that there are certain hot buttons for us, especially when it comes to money or I think we’re getting better at that. and so that might be a place to start, because that might you might be able to avoid some fights from that.

Deedee Smolin 00:43:06 I’d like to invite future thinking to imagine you could see into the future what will cash moving through your family look like a year or 2 or 3 years from now? Who’s going to manage the money? Who’s going to pay the bills? How, how, how would it flow through that would make it easiest? Slash best or slash most convenient for the two of you? And sometimes starting there and working backwards is much easier than starting in the here and now, because the here now feels permanent and it isn’t.

Deedee Smolin 00:43:37 And so if we can think about how it could possibly be. It can make it a lot easier to get there.

Betty Wang 00:43:43 I think that that makes sense because, I mean, sometimes when you have two people who are thin on their own for a while, they’re the money lead, and now it’s who becomes the money lead? Or how do you share those responsibilities while keeping each other, informed. So it’s walking through that?

Deedee Smolin 00:44:06 Yeah. back in the dark Ages, I would say, I know this is going to age date me. Seriously, I would suggest that one partner pay the bills and the other partner reconcile the bank account. That tells you how old I am. But what it did was, you know, depending on the skill set, who was better at one thing or the other, both people would see what was happening. we can’t do that anymore. That’s where having the app helps. You can just kind of see what’s going on. So, no obligation. That’s the beauty of the app is no one’s going to make you do it, you know? And most of our bills we can set up to auto pay these days so that can kind of happen.

Deedee Smolin 00:44:45 So that’s where we shift into awareness to be aware kind of watch, you know, understand what it means. My goal with clients is to give them a yardstick so that they can measure the impact of whatever change they have made or change that they’re considering. And that’s what all of this is about. What impact does getting married have on their taxes filing jointly versus separately versus, you know, staying single? What does that yardstick look like for you in that situation? So all about the yardstick.

Betty Wang 00:45:18 I mean, I think I know the answer to this, but what’s one thing that you wish every couple understood about whether it’s financial tax related estate planning before they enter a second marriage?

Deedee Smolin 00:45:33 The one thing that your willingness to be transparent is directly correlated with the likelihood of success in your marriage.

Betty Wang 00:45:42 Yeah, I feel like that’s probably across the board. Right? And yeah, emotionally transparent and right. Yeah.

Deedee Smolin 00:45:52 The more you can be present emotionally, financially, even spiritually, the the better that relationship is going to be.

Deedee Smolin 00:45:59 And that’s what we want for our clients.

Betty Wang 00:46:01 That’s true. Is there anything that we haven’t covered regarding second marriages that you want to make sure that listeners know or that I haven’t asked you about?

Deedee Smolin 00:46:12 Oh, you’ve done a really good job of covering things from hither Dione. Don’t be shy about the conversations. Understand that everybody comes with whatever baggage that they have. You know, be gentle. You’ve got baggage, too. You want your partner to be gentle with you?

Betty Wang 00:46:28 Yeah, that’s. I think that’s true. Especially for women. Right. Be gentle.

Deedee Smolin 00:46:33 Gentle on your partner. Be gentle on yourself. Both directions.

Betty Wang 00:46:36 Yes. Yes. Yes. What are my closing questions? Are most of my guests and like you as well? Like our work? Your work is very emotionally charged at times. How do you personally stay grounded and maintain balance for yourself?

Deedee Smolin 00:46:54 I’m not sure that I do, but I try.

Betty Wang 00:46:57 Well, I get that answer a lot too. No.

Deedee Smolin 00:47:00 It’s difficult. Part of being good at what you do is being invested in it.

Deedee Smolin 00:47:04 And being invested means you can’t always completely step away. At the same time, you need to be wife and parent and friend and family. So see that door as I walk through that door? I try and leave what’s here, here and and let you know. The regular. The regular may be me, but there’s no magic thing. I think that that then comes down to the wellness stuff. Eat right exercise, you know, take your vitamins.

Betty Wang 00:47:33 well, we’ve definitely had folks on here to talk about health stuff and well-being. and vitamins in particular. Yeah, there’s lots of things we can be doing.

Deedee Smolin 00:47:42 Consult with them. Yeah, well, I do work out with a trainer twice a week. That helps. So. Yeah.

Betty Wang 00:47:48 Well, that’s my next question. What do you enjoy doing? And where can listeners find you if they want to connect with you or learn more about what you and your firm do?

Deedee Smolin 00:47:58 Our website innovative financial. Com. Love to chat with you there. We can chat anytime.

Deedee Smolin 00:48:04 There’s a click on a chat with me button there. I’ve got a library of videos on YouTube under DD talks money and videos upcoming on Instagram and maybe even TikTok. I, I don’t know if they. Yeah, exactly. I feel so, so so grooving to be on TikTok, I know. and that’s the biggest. That’s that’s where I kind of hang out. I like I like video format. So if you find writing by me, you’ve found something very unusual. It exists. Not common.

Betty Wang 00:48:40 what do you like to do on your free time? What are your.

Deedee Smolin 00:48:43 What you can’t see right now? It’s too little. Little free puppies keep me company. So they are there. The the joy of my life. I have a seven month old grandbaby that’s keeping me busy as well. That’s absolutely fantastic and fun feels. I still feel like a newlywed. It’s been six years and I still feel like a newlywed, so yay for that.

Multiple Speakers 00:49:03 That is nice.

Deedee Smolin 00:49:04 We like to to go off roading, do some hiking and, you know, just enjoy each other’s company.

Deedee Smolin 00:49:10 We do lots of cooking together. That part’s fun, too. Well, those are kind of it.

Betty Wang 00:49:16 Well, that sounds like a very full life.

Deedee Smolin 00:49:18 It it is. I can never schedule my. I can never schedule myself with the best of them.

Betty Wang 00:49:23 Well, DD, thank you so much for a great conversation. I knew it would be. I knew you would have a lot of good advice for our listeners and things to think about, and not even for folks who are looking for a second marriage, but just how how to do life a little bit better.

Deedee Smolin 00:49:40 Well, that’s what we want for everyone.

Betty Wang 00:49:43 So today we talked about, you know, the financial and tax challenges of a second marriage that it’s not always easy to talk about. But really these topics are too important to ignore. And as Deedee said, transparency is really the name of the game here today. It highlights that smart planning in a second marriage is isn’t about choosing one person, one bucket over another. It’s about creating clarity, a safe space, reducing friction, and making intentional choices.

Betty Wang 00:50:14 So if this episode resonated, please subscribe to Betty’s Smart Friends or share it with someone who might need it and check the show notes. if you would like help thinking through your own planning, or if you’d like to connect with DD, I will. We’ll put some of the resources in there. Until next time, be well everyone.

Multiple Speakers 00:50:34 Thank you for tuning in to another episode of Betty’s Smart Friends. I hope you enjoyed today’s conversation and that you learned something new. You can connect with us on social media to stay updated on future episodes. Share your thoughts and join our community of smart friends. You can find us on Instagram at Betty Financial. And don’t forget to subscribe to the podcast so you never miss an episode! If you are feeling ready to be more empowered and less alone in your financial life, please schedule a complimentary 15 minutes with me. The link is in the show notes. Please see the show notes for important disclosures regarding BW financial planning and this episode. Until next time, remember you are not alone.

Multiple Speakers 00:51:20 We got you.