By Jim Miller
Getting remarried later in life can actually bring about a host of financial and legal issues that are much more complicated than they are for younger couples just starting out. Here are some common problem areas you need to think about, and some tips that can help you solve them.
• Estate plan: Getting remarried can have a big effect on your estate plan. Even if your will leaves everything to your kids, in most states spouses are automatically entitled to a share of your estate — usually one-third to one-half. If you don’t want to leave a third or more of your assets to your new partner, get a prenuptial agreement where you both agree not to take anything from the other’s estate. If you do want to leave something to your spouse and ensure your heirs receive their inheritance, a trust is the best option.
• Medical and long-term care: As a married couple, you and your husband will be responsible for each other’s medical and long-term care bills. This is one of the main reasons many older couples choose to live together instead of marrying. Staying unmarried lets you and your partner qualify individually for public benefits, such as Medicaid (which pays nursing home costs), without draining the other one’s resources. But, if you remarry and can afford it, consider getting a long-term care insurance policy to protect your assets. See AALTCI.org to help you find one.
• Home: If you’re planning on living in your house or vice versa, you also need to think about what will happen to the house when the owner dies. If, for example, you both decide to live in your home, but you want your kids to inherit the place after you die, putting the house in both names is not an option. But you may also not want your heirs to evict your spouse once you die. One solution is for you to give your surviving spouse a life estate, which gives him or her the right to live in your property during his lifetime. Then once the spouse dies, the house will pass to your heirs.
• Social Security: Getting remarried can also affect your Social Security benefits if you’re divorced, widowed or are receiving SSI. For instance, getting remarried makes you ineligible for divorced spouse’s benefits. And getting remarried before age 60 (50 if you’re disabled) will cause widows and widowers to lose their right to survivor’s benefits from their former spouse. For more information, see SSA.gov.
• Pension benefits: Be aware that if you’re receiving a survivor’s annuity from a public employees pension, getting remarried may cause you to lose it. In addition, widows and widowers of military personnel killed in the line of duty may lose their benefits if they remarry before age 57, and survivors of federal civil servants that receive a pension will forfeit it if they remarry before 55.
• Alimony: If you are receiving alimony from an ex-spouse, it will almost certainly end if you remarry and might even be cut off if you live together.
• College aid: If you have any children in college receiving financial aid, getting married and adding a new spouse’s income to the family could affect what he or she gets.
To get help with these issues, consider hiring an estate planner who can draw up a plan to protect both you and your partner’s interests.