Marriage is a milestone for many, even older adults. A lot of planning goes into a marriage, such as choosing outfits, selecting bridesmaids, and other parts of your wedding party. But there’s a lot that extends beyond the wedding itself. Older couples need to plan for other life events, such as having a living will and thinking about health. Age-related illness should become a priority to think about during the aging process. These are the challenges posed by a late marriage.
There are steps every couple should take to legally plan for aging, college funds for the kids and grandkids, and inheritance. Couples should plan their will together and decide who will get what in the event of an illness or death. Anything can happen, so financial planning is critical to a secure future for everyone. There are some legal steps older couples can take in order to make these critical plans.
Merge Your Finances
This first step requires both of you to sit down and discuss your money together. For this, you’ll both need to review and discuss each other’s debt, income, and assets. At this stage, you should be sharing critical information about any investments you have or life insurance policies you’re currently holding.
An agreement about paying bills and sharing paychecks should be set firmly in place prior to getting married. One way to do this is to assign a primary breadwinner, who is the person in charge of paying most or all of the bills. But the best and most fair approach is to agree on splitting the bills. Decide who pays which bill or if each bill will be split evenly.
Update Your Tax Filing Information
Your tax filing information needs to be updated when you make plans to get married. When doing so, you’ll first need to consider what typically serves as your primary tax payer identification number. That critical piece of information is your social security number. The way to ensure that this is done correctly is to contact your local social security office. They can provide clear instructions on how to change your name so that it will show up on your tax records. The IRS must have both names registered in order to process your return efficiently.
Whether you file jointly or separately is up to you. But you both should have any tax debts settled before you do. Any tax problems from a previous marriage should also be addressed.
Form a Prenuptial Agreement
This one can get tricky at times, so it’s important to define the purpose of a prenuptial agreement. The key is to rethink finances.
A prenuptial agreement covers items such as wills and trusts. It grants protection to both in the event of a divorce or a death. If you divorce, your partner cannot do anything to impact how your trust or estate is executed. You can decide who gets what when you die. However, if you don’t pick anyone, then your money and your assets will go to any children you had with your first spouse. It doesn’t go to a stepmom or a stepdad.
A good prenuptial agreement needs to be discussed and finalized with your attorney. It’s best to take care of it before you decide to walk down the aisle. Doing so grants your agreement better legal protection.
Prenuptial agreements cover most of the basic financial planning that’s part of a marriage. They help form a blueprint that determines how your assets will be distributed in the event of a divorce. Blended families should beware that things may get tricky during divorce. Having a solid agreement in place is good for clearing up any disparities.
However, there are some key considerations. Prenuptial agreements will not address the terms and conditions of divorce proceedings. They do not cover custody arrangements, alimony payments, child support, or visitation rights. Those decisions must be worked out in a court of law.
Have Separate Wills
Separate wills offer the best protection against inheritance problems that happen after a death. With separate wills, you and your new spouse can avoid any legal pitfalls that arise over inheritance. You can each meet with your own attorney to make important decisions about property and asset distribution, life insurance, and end-of-life care.
When you make your will, don’t just have a single copy. Make at least two other hard copies. Give one to your attorney and another to a trusted friend or relative. This gives you extra security in the event that your will gets lost or destroyed.
A second marriage requires a lot of work. Middle-aged couples who have started families should make financial plans for any kids they have. High school kids and college kids need something secure for a good start in life. Once you’ve finalized your plans, it pays to keep a list. A fair and equal distribution can ease many pains for everyone.