No matter if you are in a second or subsequent marriage, individuals who have been previously married often face a number of unique issues that influence the estate planning process.
As a result, it is critical to take these factors into consideration when performing estate planning. By following these steps, a person can avoid a number of undesirable consequences including having unwanted beneficiaries receives assets.
The Role of Prenuptial Agreements
One of the important but often overlooked legal documents that can greatly help with estate planning are prenuptial agreements, which are types of contracts that address the property rights of individuals at death and divorce.
If either spouse in a second or subsequent marriage wants to pass assets on to anyone besides the spouse, prenuptial agreements can play an invaluable role.
If prenuptial agreements are not written, spouses can assert some property interests over one another’s assets during death or divorce. This is because spouses in New York state are permitted an “elective share” of an estate.
Using Wills to Pass on Assets
Some spouses utilize wills mainly as an estate planning tool to pass on their assets to the other spouses. While these “I love you” wills can be advantageous in certain situations, they are simply not the best option when one spouse wants to leave assets to children from previous marriages or when both spouses want to benefit unique beneficiaries following these deaths.
In these situations, it is likely that each spouse’s estate planning documents will need one or several unique estate planning tools before assets are passed on in the appropriate manner.
Reviewing Beneficiary Designations
After agreeing on what estate planning tools should be used to pass on assets, it is important to review beneficiary designation that might be found in retirement plans, IRAs, 401ks, and life insurance. In many situations, it makes sense to consider the party that is appointed as a beneficiary in each of these forms.
It is often a possibility that if a person in a second marriage has failed to update their documents, the appointed beneficiary might be a former spouse from a first or earlier marriage.
Changing Account and Property Ownership
In addition to revising estate planning documents, it is also important to review joint accounts to determine how ownership of accounts and property are titled. Any assets that are jointly titled between spouses will pass entirely to a surviving spouse following the other spouse’s death.
In many situations, it becomes necessary to retitle ownerships to “tenants in common” so each spouse has a different interest in assets or in a way so that another person will become beneficiary of a property.
Speak with an Experienced Estate Planning Lawyer
It is a universal truth that good estate planning should never be exactly the same between individuals. If you have been previously married, it is important that your estate plan reflect a number of unique factors.
If you need assistance navigating with estate planning, you should not hesitate to speak with a knowledgeable contact. Contact Ettinger Estate Planning today to schedule a free initial consultation.