Key Things to Think About in Estate Planning if You are Getting Married a Second Time
Explore the Impacts of Your Second Marriage on your Estate Planning in New Jersey
Few couples enjoy talking about money, but before you get remarried, it is something that must be done. You want to make sure that everyone you love is taken care of when you have passed away. Many view this discussion as unromantic or feel that it displays a lack of trust when actually it is a way to make sure that those you love the most will be taken care of financially when you pass on.
Impact of the Second Marriage on Estate Planning in NJ
Typically, considerations should be made for the new family situation in a second marriage. Children of both partners are frequently included, although perhaps not to the same degree. If the party has adopted their stepchildren and leaves no plan for the estate, it can cause serious confusion at the time of their passing, and some may be left with nothing. Also, if the second partner is not mentioned in the estate plan, up to 1/3 of the inheritance can go automatically to them.
Challenges of Estate Planning Before a Second Marriage
The idea of yours, mine, and ours can mean a change in life insurance or inheritance beneficiaries. If you are divorced, you will need to check that your agreement does not stipulate that your ex is the beneficiary despite your separation. Spouse number two may not be thrilled about several conversations about your finances and your ex, but it needs to be done to ensure your assets are distributed according to your wishes. As far as your biological children from your first marriage and those from your second marriage are concerned, you need to set up a plan. That doesn’t mean that you are obligated to include any biological children, stepchildren, or adopted children in your estate plan, but most people do, and it is invaluable information for your attorney, former spouse, and present spouse.
Important Factors to Consider When Planning Your Estate if You Remarry
A prenuptial agreement is always a good idea, but even more so with a second marriage. It doesn’t have only to include daily decisions. A postnuptial agreement can also be made once you are married if you would like to address things not included in the prenup. These agreements are a way to start the conversation in a clear manner. It provides security not only for the partner with more assets but for the other partner, who can feel secure in the knowledge of what will happen if there is a death or a divorce. Usually, partners each own property, vehicles, etc., and establish a clear division of those items, along with any debts each has. Life insurance policies, retirement plans, and any other assets should be discussed. Children, charities, your spouse, or any other recipient of a part of the inheritance can be a part of your plan. Estate plans can be included in either agreement or made separately. The most critical factor in your estate planning is to be truthful and communicate clearly what your wishes are.
Adding Children to the Mix
If stepchildren are a part of the estate plan, it must be stated in the will. All children that are to receive part of the estate should be included in the will. You don’t want second guesses or outright exclusion from the inheritance you want to leave them. When you get married for the second time, there is no hard and fast rule about whom you should include. Sometimes, when the children are small, the partner will adopt them, giving them specific legal rights as if they were biological children. Sometimes, couples agree to include their children separately. When children are young, a trust is usually the best way to pass on an inheritance.
Updates or Adjustments to Consider in the Estate Plan
There is much documentation that should be created or updated. Of course, if you don’t have a will, that should be remedied immediately. If you already have one, changing the beneficiaries (your new spouse or any additional children) is the best way to ensure that the people you love are included. Your will should also be changed if your former spouse is your executor or would receive the power of attorney should you be unable to make decisions for yourself.
Many people don’t like to imagine themselves in long-term healthcare, but it is vital that your estate planning include this. Decisions like a DNS (Do Not Resuscitate) or other medical treatments that can only take place in a hospital should be addressed. Assisted living facilities are also a frequent topic in later years, and long-term care insurance is something that should be a part of the plan.
Titles for property, vehicles, boats, etc., augmented or diminished assets, and changes in state tax or inheritance laws require your attention. Career changes, especially if salaries or benefits change, should be examined, and any changes that need to be made can be taken care of.
A TOD or Transfer On Death Deed designation eliminates the need for probate. It allows the beneficiaries to receive the assets provided in the will through the executor without needing a probate court.
The Elective Share Concept in New Jersey
The elective share means that in New Jersey, a surviving spouse is entitled to one-third of their deceased spouse’s estate. The only way this does not take place is if in a prenuptial or postnuptial agreement, the spouses have agreed to make any claims on either estate in the case of their deaths.
The items included in this distribution include properties, bank accounts, retirement accounts, IRAs, 401Ks, stocks, bonds, annuities, and the cash value of life insurance. Property transferred to a child or a trust bequeathed to them can be appropriated in the year prior to your death. There is no ignoring this right, and the surviving spouse can force a return of the assets to provide for the elective share amount.
Estate Planning Tips That New Couples Should Follow
As previously stated, you cannot go wrong with a prenuptial agreement. That is the financial field map on which you can build your estate planning. Be sure to have a will for each of you, especially when there is property involved. Try to keep your assets separate as much as possible to uncomplicate your estate decisions.
Be honest with one another. Establish an open discussion about what your decisions are and your motivation for having them. No one likes to talk about money, but one of the most frequent reasons why married couples divorce is due to financial issues. It is always best to have everything out in the open.
Check the beneficiaries on everything from stocks to life insurance to bank accounts. You may intend for your new spouse to get a portion (or all) of your estate, but if your former spouse is the beneficiary on everything, that will be messy, to say the least.
Getting Remarried in NJ? Let Our Attorneys Assist You with the Estate Planning Process
One of the most important things we can do is provide for our loved ones after we have gone. Estate planning includes many parts that need to be carefully coordinated by an estate attorney who can work with you and your spouse to clarify your desires after you have passed on.
The attorneys at The Bronzino Law Firm know exactly how to help you and your new spouse to construct a clear, well-organized estate plan that is legally sound and specific to your situation while at the same time taking advantage of the tax structure in place for estates that will prevent your assets from being heavily taxed once in the hands of your beneficiaries. We serve as a source of information and advice for clients in Sea Bright, Rumson, Point Pleasant, Red Bank, Brick, Freehold, and other Ocean and Monmouth County communities.
Everyone says, “I’m too young to need a will. I’ll do it later.” Heaven forbid something happens unexpectedly, and your family spends several years fighting for your assets in probate court. Call the Bronzino law firm today at (732) 812-3102 or get in touch with our attorneys online. We can make a positive difference in your future today.