Thinking of remarrying? If so, there are a few precautions your must take to make sure your next marriage is successful, and that your finances and children are protected. This can include financial counseling, reviewing important documents and preparing prenuptial and postnuptial agreements.
You have concerns before you get remarried, and those concerns can grow into relationship problems unless you sit down with your spouse or future spouse and talk about finances.
As U.S. News and World Report writes, you should start with a simple discussion about your assets and liabilities. Couples also need to discuss their financial goals.
Do we have separate accounts, or do we co-mingle?
Do we get a new home, or do I keep the home I have, and you keep the home you have?”
There are a lot of personal and financial decisions that need to be discussed before the wedding party.
Florida Prenuptial Agreements
I’ve written about prenuptial agreements before. Prenuptial agreements are about more than just resolving uncertainty in a marriage.
Any couple who brings any personal or business assets to the union can benefit from one. They are also important to have in place before a couple starts investing in businesses, properties and other investments.
A prenuptial agreement (or “prenup” for short) is a contract between people intending to marry. A prenup determines spousal rights when the marriage ends by death or divorce. This can be especially important in second marriages.
If you divorce without a prenup, your property rights are determined under state law, and a spouse may have a claim to alimony while the suit for divorce is pending and after entry of a judgment.
Without a prenup, if your spouse dies, you will have statutory rights under state law to a share of your deceased spouse’s estate and may also have a right to lump sum death benefits, or a survivor annuity under a retirement plan.
That’s where prenups come in. Prospective spouses may limit or expand these rights by an agreement. Prenups are also used to protect the interests of children from a prior marriage, and to avoid a contested divorce. Prenups can be very worthwhile provided they’re done right.”
The most basic of prenups should list an inventory of premarital assets that would stay with the original owner in case of a divorce. Florida has both case law and a statute to help lawyers, judges and the parties determine if a prenuptial agreement is enforceable.
U.S. News and World Report makes several other suggestions which make sense.
Make sure your estate plan is up to date. You need to be extra cautious if you have children from a previous marriage. You want things to work out with your current spouse and also make sure your kids are not disinherited.
Update your will. Your will and beneficiary designations need to be updated for many major life events, including the birth of a child, death of a family member, marriage, divorce and remarriage.
Review all your documentation. If you are entering your second or third marriage, you may need to make significant changes to your estate plan, beneficiary designations and even your emergency contacts.
Make sure that all the documents you leave behind clearly spell out your wishes. Take the time to do proper estate planning, because a prenup may say one thing and the estate plan may say something different.
If they don’t realize it, at death there could be a problem if [the estate plan and the prenup] are not consistent in their goals.
The U.S. News and World Report article is here.