No matter when you get married or who you marry, it is important to have financial discussions and open the lines of communication about priorities. If you are getting married later in life, there are some specific considerations you should review according to an article from Investopedia, “5 (Financial) Things to Consider Before Later-in-Life Marriage”. It is important to remember that when you combine lives later in life there are a number of special considerations: financial, family, asset, housing, and retirement-related. Here are Investopedia’s five checklist items for you and your future spouse to conquer:
- How You’ll Combine Finances – Since you and your future spouse had time to establish your specific financial habits and accumulate assets, merging finances becomes trickier. It can become more complex if one partner has a younger child that requires payment or receipt of child support or alimony.
Prompts to get you started:
- Credit history and indebtedness and comfort with debt levels
- Sharing of income, savings, bills, how best to approach banking
- Investment strategies and preferences and level of savings you wish to maintain
- Your vision for retirement (where you want to live, quality of life, etc.)
- Child expenses, level of support for education or other financial assistance, formal agreement with the other parent regarding expense sharing regarding children
- Update Tax Information – If one or both of you choose to change your name, the IRS recommends that you ensure the names on your tax returns match what is registered with the Social Security Administration, or you could risk delaying a tax refund. You also need to discuss how you will file taxes, either joint or married filing separately. There may be other tax concerns depending on your situation, so if you’re unsure, make sure you ask a professional.
- Social Security Administration (SSA) – Aside from updating your name with the SSA, you need to contact them to ensure that your earnings are properly reported. Especially if you are getting married after full retirement age because this can change your Social Security benefit.
- Estate Planning – This is the most critical item you will want to address with your new spouse. Estate planning enables you to clarify inheritance of your assets as well as set forth your wishes after you die. If either or both of you have children from previous relationships, this will be important so you can plan the division of your assets in a way that makes sense and avoid any arguments or misunderstandings between children later. When you meet with your estate planning attorney, here are some thing you will review and discuss:
- Your trust and will
- Beneficiaries for life insurance policies, retirement accounts, investment funds, other financial accounts
- Powers of attorney
- Health care proxies
- Consider a prenuptial agreement. A prenup can help with determining what is left for your respective families to inherit if you divorce or die.
- Communicating your wishes to your loved ones. At Family Estate Planning Law Group, we host a Family Care MeetingTM where we bring together your loved ones and other trusted advisors to learn about your plan and your wishes, establish a relationship with one another to make sure everyone understands their role, and make sure each person knows they will be supported when it comes time to execute your plan with confidence.
- Lastly, Review Medicaid Benefits – This is something you will want to review with an estate planning attorney who is experienced in Medicaid planning. Medicaid benefits can be affected by marriage, especially if there is a change of household income when you combine finances with your new spouse. Additionally, if you haven’t done so already then now is the perfect time to incorporate Medicaid pre-planning into your estate plan.
Finding someone to marry is something to celebrate. As you enjoy the excitement that comes with preparing for your new life together, make sure you set aside some time to learn about one another’s current financial situations and financial values. Then seek an estate planning attorney who has an ongoing client care program and will work with you throughout the rest of your lives, keeping your plan consistent with life and asset changes, so you can have peace of mind that as you and your new spouse live and grow together, together and individually you are protected, and your families will be taken care of in your absence.
Even though late in life marriages have additional financial considerations, we can help you navigate them and ensure your separate and shared values are incorporated into a plan that fits your new lives.