California woman has 1 child, her husband has 7 — Dave Ramsey explains how he'd split their blended estate, and why age matters

Anne from Sacramento asked Ramsey and cohost Jade Warshaw their advice on how to plan her and her husband’s estate, given that he has seven children from a previous relationship and she has one. They’re both in their 40s and got married in May.

She said that her husband wants all eight children “to split everything that [they] have now, and build together, eight ways equally. And to [her], it seems a little bit like that somewhat disinherits [her] one child, because he has to share with the seven others.”

Ramsey told Anne with a laugh that his first thought was “what you’ve discovered is what we most often see: It’s hard. It’s very hard.”

What’s fair for a blended family?

For Anne, or any blended family planning an estate, Ramsey said that “it’s complicated because there’s not a smooth, one-size-fits-all answer.”

Ramsey said that the first thing he advises people to do is also the first thing he did with his own family: telling them “there’s no ethical or moral rights that any of them have.”

He told Anne that it’s helpful to remember that it’s her and her husband’s money. “If you leave them zero, that’s not traditional, but it’s perfectly moral. Perfectly ethical.”

“It helps me to just kind of take it all away from them to start with in my mind,” Ramsey said. “And then when I start giving it back, it feels different,” he laughed.

Instilling this kind of viewpoint can lessen the chances of an “it’s mine” scenario, where Anna’s child could feel slighted.

“It’s like, no, it wasn’t yours, you little twerp. It was mine,” he added.

Why age matters

The caller, Anne, told Warshaw that her child was the youngest, at 10 years old, and the other seven children ranged in age up to 24 years old.

Ramsey said that the first order of business when it comes to planning their estate should be providing for any of the children who are minors, should anything happen to both parents. “That’s paramount. And that could be a lump sum into a trust that’s formed upon [the] death of both of you.”

But when it comes to adult children, Ramsey said Anne’s concerns about her one child getting the short end of the stick might come into play, especially if she were earning significantly more than her husband.

However, Warshaw interjected to bring up that if the children are not adults, “and the understanding is, I want these children to look at me like I’m their mom [...] and we want that family unit to feel like a family unit, there’s part of me where I go, ‘OK, well, I no longer have one kid, now I have eight.’”

Anne said that this was also her husband’s point of view, that they ”are one family unit, that we should treat all the children equally.” She added that neither of their exes were “in the picture, so we’re the only parents to these children.”

This fact swayed Ramsey’s opinion. “That’s what you signed up for when you got married then. That makes sense.”

He said that the caller’s question wasn’t a black-and-white one, however.

“It’s an interesting discussion though, ’cause there’s not an absolute, slap your hand on the table, ‘this is dumb,’ or ‘this is smart’ kind of thing,” said Ramsey. “I’m going to draw a line between when they’re minors and when they’re not. OK, when they’re minors, absolutely your husband wins.”

Equal contributions

Anne said that her husband brought about $400,000 in net worth: $300,000 of equity in his property, where the family now lives and which they are both paying down the $500,000 mortgage on, plus $100,000 in a 401(k), and he will have a pension upon retirement.

And she came into the marriage with $200,000 in equity on a rental property (she has a mortgage, but payments and other expenses are covered by tenants) and $200,000 in her 401(k) and high-yield savings account.