Estate PlanningFamily LawProbate & WillsOn My Second Marriage… With Children From My First

30 May 2025

Second marriages in Australia are increasingly common. Many couples today bring with them adult children, shared memories from previous lives, and a patchwork of assets — from jointly owned homes to superannuation and insurance policies held individually. And whether we want to admit it or not, in many cases, the husband dies first.

So how does one navigate this increasingly complex situation, particularly when the goal is to balance providing for a surviving spouse and preserving an inheritance for children from a first marriage?

Let’s explore this challenge through a real-life inspired scenario.


A Real-Life Case: John and Mary

John, 72, and Mary, 68, are both in their second marriage. John has two adult children from his first marriage; Mary has one adult child. They have no children together. They live in a home owned as joint tenants, and while they have shared their lives for the past 20 years, their financial assets remain mostly separate:

  • John has a substantial superannuation fund and a life insurance policy naming Mary as the beneficiary.

  • Mary owns shares and an investment property.

  • They both have modest savings held jointly.

John is concerned about Mary’s well-being if he predeceases her — but he also wants to ensure his children ultimately benefit from his estate.


The Legal Framework: What Happens in Victoria

In Victoria, estate planning is primarily governed by the Wills Act 1997 (Vic) and the Administration and Probate Act 1958 (Vic). Importantly:

  • Assets held as joint tenants pass automatically to the surviving owner and do not form part of the estate.

  • Superannuation and life insurance proceeds generally bypass the estate unless the deceased directs otherwise.

  • Under Part IV of the Administration and Probate Act, children from a prior marriage can make a family provision claim if they believe they’ve not been adequately provided for.

This makes clear, thoughtful planning essential for blended families.


Estate Planning Options for John

1. Testamentary Trust for Estate Assets

John can structure his Will to create a Testamentary Trust, appointing a neutral trustee to manage assets. This allows income to be paid to Mary during her lifetime, with the capital preserved for his children. This offers:

  • Asset protection against claims and financial misuse.

  • Tax efficiency, as minors receiving income from such trusts are taxed at adult rates.

  • Protection against re-partnering risks, as the trust becomes irrevocable upon John’s death.

2. Superannuation Death Benefit Nomination

Superannuation is not automatically part of the estate. John can:

  • Nominate Mary to receive a reversionary pension, ensuring a steady income.

  • Direct a portion to his estate, where it can be allocated into a testamentary trust for the benefit of his children.

Alternatively, if John’s children are not financially dependent (and thus not tax-favoured recipients), he may choose to leave the superannuation entirely to Mary and offset this with other estate provisions for his children.

3. Separate Life Insurance Policy

John could maintain the current life insurance beneficiary nomination to Mary, or, if concerned about fairness, he could:

  • Assign a second policy directly to his children.

  • Channel the policy into a superannuation proceeds trust, administered by an independent trustee, to balance the interests of both parties.

4. Property Ownership via a Mutual Will or Life Interest Trust

Rather than owning the home as joint tenants (which passes full ownership to Mary), John and Mary could:

  • Convert the ownership to tenants in common, each holding a 50% share.

  • Create a mutual Will agreement or life interest trust allowing Mary to remain in the home for life, after which John’s share is passed to his children.

This structure ensures the family home remains available for Mary’s lifetime without disinheriting John’s children.


Potential Pitfalls and Why Planning Matters

Without proper planning, the following risks are real:

  • Mary could inherit everything, leaving John’s children with nothing.

  • Family provision claims could result in costly litigation.

  • Poor trustee choices could lead to biased decisions and fractured family relationships.

Importantly, naming one’s spouse or children as trustee can backfire due to perceived or actual bias. Using a professional independent trustee can provide neutrality and minimise conflict.


Final Thoughts: A Conversation Worth Having

Estate planning isn’t just about money — it’s about values, legacy, and relationships. For blended families, especially in second marriages, it’s vital to have honest discussions about intentions, expectations, and responsibilities.

In Australia, and particularly in Victoria, the law provides the tools — but only thoughtful planning can provide peace of mind.


Ready to Protect What Matters Most?

At Hayton Kosky, we specialise in helping couples in second marriages navigate the delicate balance of looking after a spouse and preserving an inheritance for children. Whether you’re considering a testamentary trust, dealing with complex superannuation arrangements, or simply unsure how to start — we’re here to help.

🔹 Book a confidential consultation today
🔹 Understand your estate planning options
🔹 Create a plan that reflects your values and family structure

👉 Visit our Wills & Probate page to get started:
https://haytonkosky.com.au/wills-probate/

Let’s put a clear, compassionate plan in place — for you and those you love.