Getting remarried with an estate plan can be complicated
If you are getting remarried, there is a good chance that estate planning is not the first thing on your mind. But, you need to make time to revisit your estate plan. It’s important to consider the impact that marrying your second husband or second wife will have on your financial plan and the management of your estate.
Remarrying is going to bring some big changes to your life as well as that of your new spouse which may necessitate making some significant changes to your estate plan. Complications can arise if either of you have children from your first marriage or if one of you has more assets than the other.
Are either of you bringing any debts into the marriage? Are there any assets that each of you will continue to hold individually? Is a prenuptial agreement needed to protect your individual assets?
California is a community property state. In California, all property that a couple acquired during marriage is considered marital, or community property. This means each spouse owns half of the community property. And what each spouse brought into the marriage, or acquired prior to marriage, is considered separate property. Here, property means any asset (not just land or ‘real property’).
Ideally, have discussions about these and other issues before you tie the knot to help minimize potential conflicts that could arise after you are married. In preparation for this discussion, both of you should make a complete inventory of your assets as well as debts, including life insurance policies and retirement plans/accounts. Honesty is the best policy if you want to prevent bad feelings down the road.
What to avoid
Both you and your new spouse will need to decide where each of you want your assets to go after death. Do you have children from a previous marriage? You may want to leave certain assets for your children, but your new spouse may want those assets to be distributed equally among their children as well as yours. Who will assume control of your assets on behalf of any minor children should one of you die prematurely?
In these types of situations, you may need to update or establish a new will, establish a new joint will, or set up a trust with provisions for what share of your assets are to be set aside for your children. If you and your spouse plan on having additional children together, what assets are you going to provide for them after your death?
The bottom line? Re-evaluate your estate plan if you are getting married with an existing estate plan in place.
Getting legal guidance
Getting remarried? Consult with an estate planning attorney, especially if you have children. And update or create a new will or living trust, update or create new estate planning documents such as a durable POA and health care directive and make changes to the beneficiaries on life insurance policies, annuities, and/or retirement accounts. Consider a prenuptial agreement and/or trust to safeguard your children’s inheritance.
At the Law Office of David W. Foley, California Living Trusts, our attorneys will help you plan for your new family because we are a family run firm. We offer quality estate planning services to help you take care of all those you love. Check out our tips on estate planning for your second marriage.