Bing Crosby has convinced us that “Love is lovelier the second time around”. At the same time, the singer understood that a second marriage should be entered into with “both feet on the ground.”
Among other things, feet-on-the-ground estate planning means avoiding second marriage estate planning mistakes, observes John Waggoner in AARP. While a second marriage can “be a balm for the heartache of losing a spouse through death or divorce”, Waggoner observes, if there are children involved on either side or both, you should carefully consider what will happen with your money and possessions when you pass on.
4 obvious items on the second marriage estate planning “to-do” list, Waggoner points out, are:
- Changing beneficiaries on insurance policies, annuities, pensions, and anything else with a beneficiary designation. (Too often, the deceased former spouse’s name has remained on these documents or accounts).
- Since most spouses aren’t financial equals when they marry a second time around, it’s important to consider whose children will receive the proceeds when the home is sold, and who receives what share of whose assets upon the death of each spouse.
- Changing your power of attorney and healthcare proxy documents (most will have named their former spouse) to either the new spouse or an adult child.
- Deciding who gets each one’s important family, sentimental item “stuff”. You may not want your spouse’s children to inherit your mother’s pearl necklace. You can document your choices in a codicil to your will or in a letter of instruction to your executor.
Interestingly, Waggoner encourages second time around-ers to not wait until they’re gone to give. “You’ll get the pleasure of seeing them use that money while you’re still on the planet,” he predicts.
At Geyer Law, an important item we suggest adding to the second-time-around marriage to-do list is a prenuptial agreement as state law provides your spouse with certain rights which can interfere with your desire to leave assets to children. While each situation is unique, requiring the tailoring of the document to each couple’s needs, benefits of a “pre-nup” include:
- Protecting each spouse’s separate property
- Documenting special arrangements between spouses
- Assigning debt to the appropriate spouse
Love can certainly prove lovelier the second time around, but our attorneys at Geyer Law want to be sure the second marriage is entered into with “both feet on the ground.”
– by Ronnie of the Rebecca W Geyer blog team