According to the U.S. Census Bureau, 17% of people in the United States who lose a spouse from death or divorce eventually remarry. The rate of both divorces and remarriages has risen for those age 55 and older over the past seven years, while each has dropped for other age groups.
Older people often approach marriage with more baggage. They may have kids from a previous relationship, most likely grown children or adolescents, and more assets than those who divorce earlier in life. Estate planning becomes even more important for these people because more is at stake. Anyone who embarks on a second marriage, especially those who are older, should consider the following.
1. Updates to documents
A person remarrying should review key estate planning documents, such as advance directives and wills, and make any changes necessary to bring them up to date. For example, this may mean removing the former spouse’s name and replacing it with the current spouse.
2. Changes to beneficiaries
Even an updated will cannot supersede beneficiary designations for life insurance policies or retirement accounts. The money will go to whomever the account lists as a beneficiary. Therefore, as one updates one’s will, one should also check that the beneficiaries listed on those accounts are the people whom one wants to receive the money upon one’s death.
3. Prenuptial agreement
Because one frequently brings more assets to the second marriage, a prenuptial agreement is a matter of necessity. It can tie into the estate plan by preserving assets from a potential divorce so the children can eventually inherit them.
Communication is also key when it comes to estate planning after a second marriage. Both the new spouse and the children of the previous relationship should know where they stand ahead of time.