Second Marriage and Estate Planning
April 24, 2023
Many people who get married and start a family create an estate plan. They want to ensure their spouse and children are taken care of if they were to pass.
So many life events create a need for that plan to be updated. The birth or death of children, for example, or a divorce from their other parent. However, what happens if you decide to marry for a second time? Should you update your existing estate plan or start from scratch?
These are wise questions to discuss with your estate planning attorney. Second marriages often raise complex issues with an estate plan. So, if you live in Ocala, Florida, or anywhere in Marion County, we can talk about the best way you can have an estate plan that addresses those issues according to your wishes. At Michael A. Siefert, P.A., I am proud to help clients in second marriages and put their loved ones first.
What Are the Rights of Surviving Spouse?
The person you are married to at the time of your death, whether it be a first, second, or subsequent spouse, retains certain survivorship rights in Florida. These rights of a surviving spouse protect the spouse, but they do not protect the rights of your children to benefit by inheritance. For that, you will need a new estate plan.
Your surviving spouse in Florida can claim what is referred to as their “elective share,” which comprises 30% of your estate, 30% of property owned only by you, 30% of any property owned jointly by you and another person, and 30% of your revocable trust.
Then, there is Florida’s homestead right. This gives the surviving spouse the right to the home’s real property for the remainder of their life, even if you leave it to your children in the will. Moreover, once your spouse dies, the home is passed to their lineal descendants, not yours.
You may want your second spouse to have everything, but if you have children you don’t share with that spouse whom you want to inherit, what is left may not be what you intended to leave behind. You need to address the inheritance of the children before you marry for a second time.
What Are the Key Considerations in Creating an Estate Plan for a Second Marriage?
Fortunately, the estate plan in a second marriage, if crafted well, can address these issues, allowing you to leave your legacy to your surviving spouse and your children or anyone else you choose to benefit from your estate. Here are a few key considerations your estate planning attorney should discuss with you.
A prenuptial agreement can supersede the survivorship and homestead rights of the surviving spouse. A witnessed pre-marital agreement signed by both spouses allows you to leave individual assets to whomever you wish. This clears the way for you to leave what you want to your children, other beneficiaries, and your spouse in your will or trust without those other Florida laws coming into play.
Inheritance of the children does have some protections under Florida law. Generally, the surviving spouse is entitled to 50% of the estate and the children to the other 50%. If there is more than one child, that 50% is divided equally among them. There is also a presumption that a child born after the will was executed shares in that 50%, even if that child is not specifically named in the will.
Some trusts can protect your assets and provide for you to designate the beneficiaries of the trust. There are also ways trusts can penalize your children. A marital trust, for example, can provide an income for your surviving spouse, but it does so at the expense of children who must wait until the spouse dies before they can benefit from the trust. If your spouse is younger than you or even younger than your children, this can leave them with nothing. Instead, you may want to create a trust that benefits your spouse and your children separately by leaving your spouse a certain amount of assets and transferring the residual immediately to your children.
Beneficiaries in a second marriage may be your spouse, children, or other individuals or charitable organizations. In addition to specifying who you want to benefit from your estate and how in a will or a trust, you should review all beneficiary designations and transfer or title on-death designations. These typically appear on life insurance policies, retirement accounts, real estate deeds, vehicles, and other assets you own.
Long-term care costs are a major concern in an estate plan. Rising costs make it easy for Medicaid to demand a spend-down of all applicable assets (some are protected) before Medicaid will cover the cost of your long-term care. Irrevocable trusts may be one consideration for your estate plan to protect your assets. That is because once you transfer ownership of your assets to the trust, they are no longer yours. Therefore, they are no longer exposed to Medicaid garnishment. If you attempt to give away your assets within five years preceding your Medicaid application to avoid making them accessible to the program, you will be penalized. Savvy and timely estate planning can protect your legacy for those you want to benefit from it.
What Are Some Common Mistakes I Need to Avoid?
There are several mistakes people often make in their estate planning when they remarry. For example, trying to revise an existing plan will not work. You need to start over.
Don’t forget everyone you want to protect in your plan and don’t assume someone will “do the right thing” when you are gone. For example, don’t assume that your surviving spouse will relinquish the right to 30% of every asset you own or to the marital home. You should ensure the plan addresses all your assets according to your wishes.
Do not make the mistake of reviewing all the tax implications of your plan to your estate, your surviving spouse, your children, or any other beneficiaries. If not properly addressed in your estate plan, taxes can consume what you believed you were leaving behind.
Although you can tackle some estate planning issues before you say “I do” to your second spouse, it is better to not wait. Deal with them before you get married.
Finally, don’t assume a simple will is sufficient to address all the complex issues of a second-marriage estate. Rely on an experienced estate planning attorney to help you create your plan.
Compassionate & Skilled Legal Counsel
Second marriages can create all kinds of complications with your estate plan. Those complications can also cause stress and friction between your new spouse and children. It’s your estate. You decide what happens to it when you are gone. I can help.
Contact my firm, Michael A. Siefert, P.A., in Ocala, Florida, today to schedule a time to talk about creating an estate plan that addresses the complexities of a second marriage.