Regardless of whether you’re widowed or divorced, making the decision to remarry can be complicated. Some people have reservations about remarriage because they realize how difficult it can be for two people to merge a lifetime of financial decisions. Others pause to take the next step in their relationship because they do not want anything to compromise their children’s ability to inherit their assets at death. Regardless of your situation, here are a few tips for those faced with a second marriage:
One practical option is to title property, such as a home, as a life estate. For example, suppose John remarries and has two children from a previous marriage. When he dies, he does not want his wife’s life disrupted with the reality of a move. On the other hand, he wants his children to benefit financially from the sale of the family home. In this scenario, John may want to consider a life estate with this property. With a life estate, John’s new wife can live in the property as long as she lives. She will enjoy all of the rights and privileges of ownership and will be responsible for all maintenance, repairs, taxes and insurance. However, she cannot sell the property without the consent of the remaining heirs. Then, when she passes away, John’s children can inherit the property. This option resolves John’s desire to always provide a place for his spouse to live, while at the same time ensuring that his intended beneficiaries ultimately benefit financially from the property.
For those preparing for marriage, prenuptial agreements are worth consideration, as well. These agreements have a bad connotation because people often feel as if the couple is planning for a divorce before they marry. Even though divorce is not certain, death is, and prenuptial agreements can be an effective tool to address the transfer of assets that were acquired prior to the marriage in the event of divorce or death.
Second marriages, like any other, come with their fair share of challenges. Nevertheless, with proper estate planning, you can work to minimize some of the financial stressors associated with the death of either spouse.
Life is a journey. Plan for it.