Finding love and companionship again after divorce or the death of a spouse — or even finding love for the first time — is reason to celebrate.
For many people who get married after the age of 50, it will not be their first trip down the aisle. Forty-two million Americans have been married more than once. Plus, 50 percent of people over 65 who get married are not first-timers. And with matrimony comes change. Each person is bringing his or her respective families, histories and finances together. Here are some considerations to help keep that blending as seamless as possible, in sickness and health, and ’til death do you part.
Combining and sharing finances
Older couples who wed are probably less inclined to combine all their assets the way many young couples will. They likely have individual retirement accounts and investment accounts, own real estate or a business, or have received alimony or a family inheritance. They may even be carrying liabilities, such as loans or a mortgage, that a soon-to-be spouse is not a party to.
Full financial disclosure is beneficial in determining which finances to combine and which you want to (or need to) keep separated. Circle in your financial and tax advisers to let them know of your plans and to get their advice.
Join today and save 25% off the standard annual rate. Get instant access to discounts, programs, services, and the information you need to benefit every area of your life.
Decisions also have to be made about sharing expenses, as well as who will be responsible for payments of those expenses, and for how long. So, as soon as possible and, ideally, before the wedding, reach a written agreement about how debts and assets are to be separated or shared, not just during your marriage but also in case of divorce or death.
To prenup or not to prenup
A prenuptial (or “premarital”) agreement can be a useful tool to clarify a couple’s expectations and understanding about how their finances will be retained or split should they split up. Although few get engaged while anticipating a future divorce, the reality is that the rates of these splits are much higher for second (or subsequent) marriages than for first-time marriages. Those who have been through divorces may not want to repeat experiences of the past and may be more open-minded about having a premarital agreement drawn up; regardless, it’s a worthy exercise for most couples.
But what if you have already walked down the aisle? It may not be too late. A postmarital agreement can serve the same purposes as a premarital agreement. Be aware that they are not recognized in some states and may be harder to enforce than a premarital agreement.
A pre- or postmarital agreement may not seem romantic to some, but consider it a gift to a new marriage — setting a foundation of understanding to prevent future struggles. So, even if you go your separate ways, it will be with more ease and less conflict.
Marriage is a major life event and, along with divorce, one of the “five D’s” that should prompt an update to an estate plan. (The others are death, a diagnosis, a decline in health or turning a new decade of life.)
A new couple should work with an estate planning attorney to prepare life-care planning documents — these will set forth who has authority to help you with your medical, legal and financial needs should you become ill or incapacitated. Now is the also the time to prepare or update post-life planning documents. What the premarital agreement can do for your financial protection in the event of a divorce, an estate plan can do after you die. Through wills, trusts and beneficiary designations, you can predetermine how much your spouse will inherit from you, versus family, friends and charities. Many later-in-life married couples want to provide for their spouses should they be the one who dies first, but they also want to distribute assets to adult children and grandchildren. An estate planning attorney can offer options of how to meet these objectives and educate you on what a surviving spouse’s legal rights are in your state of residence.
The legalities can be tricky. Some states have laws that prevent a person from disinheriting a spouse or that automatically allow them to inherit a share of an estate even if a person did not provide for them (such as in community property states or those with spousal share laws). These laws can lead to results that spouses don’t intend. For example, in Florida, a surviving spouse may end up as a co-owner of real estate property with stepchildren or only be able to utilize the property during his or her lifetime — with all parties involved having to share the expenses.
When you meet with an attorney, ask for counsel on how a surviving spouse inherits property in your state of residence. Discuss whether and how it is possible to have spouses waive their rights to property or receive it with conditions that make sense for the family.
Knowing and planning for these legal defaults can prevent surprises to the surviving family members and, even better, prevent lawsuits among them in the future.
Practical planning for caregiving
Sometimes the unthinkable happens. A parent becomes suddenly ill and his or her adult children sue a stepparent over caregiving or legal issues. A future caregiving plan can really help with this. If you fall ill or are incapacitated, a preplanned care agreement can help prevent conflicts and stalemates among your now-blended family. Don’t worry about what will happen 10 or 15 years from now when you are older and in a different phase of life — plan as if you will need caregiving tomorrow.
Are you and your spouse in relative good health today and able to manage if the other one needed caregiving assistance? If your health took a turn, do you want to age in place, or is it possible that one of your children would want you to live closer by? Talk it through with your spouse and your kids so that everyone understand your wishes.
I’ve seen scenarios in which adult children come to visit a parent and then they transport the parent home with them, out of state, without the spouse’s input or consent. Or adult children will apply to be a guardian for a parent and try to exclude the spouse from having any say over the husband or wife’s medical care or decisions about his or her assets. When that happens, it can be heartbreaking and fracturing for the family. A few good conversations, as well as a solid, written care plan, can help prevent a painful familial tug-of-war down the road.