How should your will change if you marry?
When a remarriage occurs late in life, potential problems can arise over an existing home.
It may be hard to broach the subject of death when you are getting married later in life. If you have children from a prior marriage, what will happen with assets and control is a necessary, difficult conversation.
However, not having the difficult talk sets the table for big family problems later. When financial decisions and medical caretaking are stumbled upon, many unexpressed expectations will likely collide.
If you remarry, it’s not always an easy situation when a spouse moves into their spouse’s home when they marry. Would the surviving spouse receive the home when the other dies? Does the home go to children from a previous marriage or previous arrangement? A good estate plan can resolve many potential problems in a remarriage situation, according to the Times Herald-Record, in “How to preserve your home’s value when remarrying.”
With poor planning, you might end up with your assets going to your second spouse and then to his or her own children, leaving your own children empty-handed.
A common approach is to leave the surviving spouse the right to use and occupy the residence, with a provision in a trust or a will that the surviving spouse pays taxes and home insurance costs and maintains the house. The right to live in the house can be for a limited number of months or years or until they pass away or enter a care facility. When the surviving spouse dies or the time limit is reached, he or she leaves the house, the house is sold, and the proceeds are divided among the children of the owner’s spouse.
Some questions to consider: What if the house needs to be sold? Can the spouse use the proceeds to purchase another house? How long is the usage of time? Who can be there?
There are other ways to provide more flexibility to the surviving spouse. If the house is too large or expensive to maintain, he or she may be given the right to use and occupy a substituted property, which may be purchased with the proceeds from the owner’s spouse’s home. Another arrangement allows the owner’s spouse’s home to be sold with the surviving spouse using the income from the proceeds of the sale of the house to pay for a rental. When the surviving spouse dies (or when the term expires), the first spouse’s children inherit what is left.
A few important things to consider: how well the surviving spouse will be able to maintain the house, either for financial or physical reasons. If the surviving spouse does not care for the house and it falls into disrepair, the children may have to file an eviction proceeding. If the trust or will does not specifically instruct the surviving spouse to pay for home maintenance, the children of the owner’s spouse would be responsible for those costs, and depending on how long the surviving spouse lives, that could be a large burden for a long period of time.
This situation requires thoughtful planning, with many “what if” questions. An experienced estate planning attorney who has worked with second marriages and home ownership issues will be able to provide an objective view of the issues and solutions.
Prenuptial agreements can address these issues very well. They take time and commitment to complete.
The biggest problems occur because the tough issues were never faced. You can lay down the law about your decisions, and the family may love it or hate it, but they will know it’s not an accident.
An estate planning attorney can advise you in creating an estate plan that fits your unique circumstances, including a second marriage.
Reference: Times Herald-Record (Sep. 22, 2018) “How to preserve your home’s value when remarrying”
