Are you planning to remarry? Are you and your future spouse busy with wedding plans, family and finding a new place to live? However, with all your planning, have you considered any estate planning at all? Did you know that remarriage and estate planning often work hand in hand?
For instance, in a first marriage, the goals of each spouse are typically aligned: take care of the surviving spouse for as long as he or she lives, and then divide what is left equally among the children. By contrast, if the children are still minors, you set up a trust for the kids until they are adults. This makes sense because most couples jointly own their assets but not necessarily when dealing with remarriage and estate planning.
However, in a subsequent marriage or when marrying later in life or after amassing significant wealth the goals may not be so perfectly aligned, and the old methods for estate planning may not work. For instance, if you decide to put your new spouse on the title of your home, it is now considered to be owned jointly with the right of survivorship. That means, when you pass away, the home becomes the property of your spouse, without restriction, and there may be no guarantee that he or she will pass it along to your children from a prior relationship.
The first tip for estate planning: consider planning separately. Especially if you or your soon-to-be spouse have significant assets. Be sure to make this decision together and have an honest conversation about your individual estate planning goals. If your goals are sufficiently similar, then you may be able to plan jointly. If they are significantly different, consider having separate attorneys.
The second tip for estate planning: if you have significantly more assets than your spouse, consider using a QTIP trust in remarriage and estate planning. For example, with a QTIP trust your spouse could continue to live in your home, but upon his or her death, your children and not the children of your spouse would inherit the property.
The third tip for estate planning: consider naming a trust as the beneficiary of your life insurance. The trust will then allow you to control when and to whom monies are distributed, so that you can provide for your spouse during his or her lifetime, and yet keep control over the proceeds. The trust can also protect your spouse from irresponsible spending, creditors, predators, and even estate taxes.
We know this article may raise more questions than it answers. At Britton G. Swank, P.A., our mission is to guide you in the right direction to help you provide for yourself and your loved ones no matter what the future holds. We want to help you control the assets you have, leave them to people and causes you care about, when you want, in the way you want. We can help you take care of yourself and those you love in the event of disability due to illness, injury or old age. No matter what risks unfold, we can help give you the comfort of knowing you are prepared. We want you to feel good about your future and the future of your loved ones. We encourage you to contact us and schedule a meeting.