Typically, significant life events are driving factors for individuals to evaluate or re-evaluate their estate plans. Whether these events include getting married, having children and grandchildren, retiring or needing long-term care, lives change. And it is crucial to accommodate for these changes in your estate plan. However, what happens when you don’t have an estate plan in place and decide to get married later in life? Furthermore, what happens when you do have an estate plan in place and decide to get married later in life?
Once most people reach their golden years, they finally get to enjoy retirement and what they’ve worked so hard for during their lives. Their net worth is quite possibly the highest it’s ever been. They’ve diligently contributed to their 401(k)s and typically have large IRAs in their name. Their house might be paid off, or maybe they’ve recently splurged and purchased their dream home they can finally afford. Your retirement is the time to reap the benefits of your hard-working younger years, be happy and relax. For some, this happiness might include a new spouse to enjoy this time with.
Getting married after retirement might seem like a simple process. You’ve already had your careers and most likely experienced a previous marriage and raised your children. What could possibly go wrong when you seemingly have it all figured out?
With any marriage, if only one of you needs long-term care, both of your assets would exposed to long-term care costs. This means you could be forced to liquidate assets, including IRAs, and your home could be vulnerable to liens from Medicaid, regardless of whose name it is in. You could essentially lose the majority of your estate just because your spouse needs long-term care.
Distributing assets can be especially complicated with blended families when either the first or surviving spouse passes away. Without an estate plan in place, the assets of the first spouse would pass to the surviving spouse. Even if the first spouse has a will in place directing all assets to their children, the surviving spouse would still be entitled to a good portion of whatever the first spouse has left behind. This might not be what the first spouse to pass away intended.
While the aforementioned potential situations should be factors when you are considering getting married after retirement, they certainly don’t have to deter you from matrimony. Just as all big life events should cause you to re-evaluate your estate plan, it is especially true if you decide to wed in your golden years. Whether you want to keep your assets completely separate or share every asset you’ve accumulated throughout your lives, you and your spouse can put an estate plan in place to best suit both of your needs and wishes.
Most people don’t know what options are available to them for their estate plan. They assume the state laws should be the standard. In reality, these laws can cause some major issues with divorce, death or long-term care planning, especially with blended families. Contact an AlerStallings attorney to explore these options and discuss what would best suit your estate plan.