Marriage is a new chapter in your life, whether it is your first, second, or even third time. But just like other life changes, they can impact your estate plan. Revisiting your Estate Plan before you get married can help you and your partner before you walk down the aisle. Knowing what to expect may help you avoid complicated issues in the future, especially if you create a Premarital Agreement.
The Importance of Estate Planning
Estate Planning is the advanced planning and maintenance of a person’s estate. It is the blueprint for a person’s wishes once they have passed away. When you are planning your estate, you’re making decisions for each asset that you owe, including:
- Wills and trusts
- Beneficiary designations
- Life insurance
- Powers of attorney and health care directives
- Living wills and advanced health care directives
Each of these areas can change once you have married or remarried. Knowing what to expect can help you make the best plans for your entire family. Here are the top estate planning issues each engaged couple should consider before getting married.
Include a Premarital Agreement
A premarital agreement is an agreement between two potential spouses before you get married. This agreement determines the legal rights that each spouse has during and after the marriage, including the rights to marital assets. Many benefits come with a prenuptial agreement, including:
- The protection of your assets.
You and your spouse can protect the assets with which you both entered the marriage and avoid disagreements about your marital assets.
- A clear understanding between both spouses.
You and your spouse can clearly define your assets’ terms and conditions.
- Financial aid and protection for the children.
Your premarital agreement can protect your children in case your marriage ends.
- Peace of mind.
Putting a premarital agreement in place can help you and your spouse avoid future arguments.
Updating Wills and Trusts
After creating your premarital agreement, you want to do the next important step – update your will and trust. If you already have a will established, you want to ensure that the information in your will aligns with your premarital agreement. If you are creating your will or trust for the first time, consider the types of trusts to include in your Estate Plan. Some of the different types of trusts include:
- Irrevocable trusts.
These types of trusts cannot be changed once they are set up.
- Revocable trusts.
These are the trusts where changes can be made anytime as long as the grantor is mentally competent.
- Asset protection trusts.
Asset protection trusts help grantors protect their assets from creditors or other parties.
- Charitable trusts.
Grantors use these trusts to provide money to a specific cause or organization.
- Marital trusts.
Married couples use these trusts to provide for their spouses following their death.
Whatever trust or wishes you prefer during your marriage, you want to ensure that your will reflects those changes.
Update Beneficiary Designations
In addition to your will and trust, you also want to update your beneficiary designations with beneficiary agreements. Beneficiary designations are the people that you transfer your assets to following your death. Each one of your assets requires a beneficiary designation, including:
- Bank accounts
- Retirement accounts
- Life insurance policies
- Investment accounts
Failing to update your beneficiary designations is just as bad as not having a beneficiary designation listed. You may assume that the changes made to some of your assets are automatically transferred into your other documents, but that’s not the case. You want to ensure that your spouse is listed as a beneficiary on each asset.
Updating Life Insurance Policies
Life insurance is an asset that can provide financial protection for your loved ones if you unexpectedly pass away. You want to ensure your spouse is included as a beneficiary. If your spouse has children from a previous marriage, you also want to ensure they are listed as beneficiaries on your life insurance policy.
If you and your partner are searching for a life insurance policy, there are many options to choose from, including:
This life insurance covers your spouse and children regardless of when you die.
Term life insurance is temporary insurance that offers a death benefit for a fixed period.
- Whole life insurance.
This type of insurance requires a fixed monthly payment for a guaranteed death benefit. In exchange, your beneficiaries are covered for the rest of your life.
Powers of Attorney and Health Care Directives
Another important decision is to designate your spouse as your power of attorney. A power of attorney is a document that allows another person to make decisions on your behalf when you are incapacitated. These decisions can be:
- Making financial decisions on your behalf.
- Decide what type of medical care you receive
- Choose the type of doctors that you can use
- File taxes on your behalf
- Manage your estate
You also want to ensure your spouse is listed on an Advance Healthcare directive document. This document allows you to share your wishes regarding end-of-life care. If these documents are not included in your Estate Plan, your spouse may waste additional time and money trying to be granted these powers through the courts.
Before You Get Married, Call THE South Florida Estate Planning Attorneys – The Siegel Law Group
Before you get married, call the Siegel Law Group. With the assistance of our knowledgeable South Florida Estate Planning attorneys, you can navigate the intricacies of Estate Planning and rely on our expertise, ultimately providing Peace Of Mind for you and your loved ones. Call our office at 561-576-6206 for a complimentary consultation, or submit our online contact form to schedule a consultation today. If you have any questions, do not hesitate to contact us.