What to Consider When Estate Planning in a Second Marriage
When you’re in a second marriage, your estate planning process may look a little different than it does for couples who have only been married once. Both spouses in a second marriage might already have children from prior relationships. In addition, each spouse may have brought assets into the marriage that the spouse wants to reserve for his or her own children upon his or her death.
Below are a few other issues you should take into consideration when estate planning in your second marriage:
- Beneficiary designations: People often name their spouse as the beneficiary of their life insurance policies, individual retirement accounts and various other tax-deferred plans. However, your spouse may generally name anyone he or she wishes to inherit those benefits upon his or her death.
- Substantial assets: If you and your spouse each already have considerable assets, you might consider creating a prenuptial agreement or using other strategies to keep your assets separate from the rest of your estate planning process.
- One spouse has fewer assets: If your new spouse has fewer assets than you do, you can provide for him or her until death or remarriage, and then have the rest of the assets distributed to your children. One way of accomplishing this is through a QTIP trust.
- Younger spouse: If your new spouse is significantly younger than you, your children could be concerned he or she only married you for your money. While these feelings could very well subside over the course of the marriage, there are still likely to be some concerns about their inheritance. Consider arranging to have some of their inheritance passed to them upon your death, and the rest upon your spouse’s death or remarriage.
- Name a trust as beneficiary: A common practice for people in second marriages is to name a trust as the beneficiary for life insurance policies and tax-deferred plans. This helps you retain control over how those benefits are distributed — and to whom.
For further guidance and advice on estate planning when you are in a second marriage, consult an experienced Tampa will and trust attorney with BaumannKangas Estate Law.