Have You Protected Your Assets in Your Second Marriage?
If youâ€™ve just decided to get married again, you need to take the right measures to protect your assets in your second marriage. As you may already know, failing to do so can keep the intended family members from accessing your wealth in case you pass on, or the second marriage fails to work out. This post explains in detail everything you need to safeguard yourself and the relevant beneficiaries after a remarriage.
Get an Attorney
If youâ€™ve not tied the knot officially, the first thing you want to do is look for an estate planning attorney. If you donâ€™t already have an estate plan in place, take the necessary measures to have one before you enter the second marriage. Your estate planning attorney will take you through the process so that itâ€™s easy for you.
Review Your Previous Estate Plans
If you had already established an estate plan with your previous spouse, then you should review your trusts, wills and any available beneficiary designations, like those tied to your retirement accounts or insurance.
Similarly, you need to review any agreements regarding child custody and divorce, and understand the impact they have in your previous estate plan. Weâ€™ve always noted that some divorce plans have certain obligations that direct individuals to keep their ex-spouses as beneficiaries even when they remarry. You may find yourself in such a situation, and it means that you need consider your ex-spouse when you create a new plan that involves your new spouse.
Get Your Prenup and Other Documents in Order
There are certain documents you need to get in order to effectively protect your assets in your second marriage and ensure your new spouse and any kids you might have are taken care of in case you pass away or your marriage fails. One of them is the prenuptial agreement.
Your attorney should assist you draft a good prenuptial agreement to prevent disagreements as to who gets what in case things go south. This agreement will help you protect your interests and understand any asset protections your new spouse may have put in place ahead of time. You have to make sure you both sign this document before the wedding after receiving independent advice on the terms of agreement.
Create an Asset Trust
You may also need to create a trust to keep your premarital assets safe from your second marriage. This is also important because it can help you protect any assets for your kids from your previous marriage. Remember to ask your attorney to assist you to set up an asset protection trust, and ensure the spousal and creditor protections are in place.
As it is very likely that both of you will bring your own assets into your marriage; remember that the law considers such assets separate property.
Revise Your Will and Social Security Benefits
If youâ€™ve not looked at your will, now is the time to do so and make the necessary changes. For instance, if the document is listing your first spouse, you may want to replace the name with that of your current spouse to avoid any conflict later on. You can also include any other beneficiaries, such as children in your second marriage. At this point, you can make sure any inheritance for your children from a prior marriage is protected. Remember that the distribution of assets as set out in the will has to correspond with your prenuptial agreement.
Moreover, itâ€™s possible youâ€™re having social security benefits from the work record of your previous spouse. As this will change when you remarry, you need to ask your attorney to review such matters; they should consider any ways your new marriage can affect the benefits.
Consider the Tax Consequences
During the estate planning process, you need to balance your assets and the likely tax consequences of holding those particular assets. Try finding out whether you have any estate tax exclusions at your disposal. Also, try consulting with your attorney if you have any high-value estate that is subject to taxes. They will guide you through all the relevant tax consequences depending on your state.
While experts agree that second marriages are usually more likely to be successful than first marriages, individuals who enter the second marriage without an asset protection plan often create serious family disputes when they pass on or when the marriage doesnâ€™t work out. You need to take the necessary measures to prevent this, and keep your wealth in the right hands.
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