After months of picking out wedding cakes, perusing gowns and shopping for flowers, discussing estate planningcan feel, to many people, like a doom and gloom conversation. However, having an estate plan to protect and care for your new spouse can not only strengthen your financial situation, it can also help your marriage.
As time passes, starting an estate plan will only become more complicated; children and grandchildren are born, assets change and family dynamics shift. Getting an early start on an estate plan for your new family will lay the groundwork for your future and can be tweaked as your family changes and grows.
Here are some of the documents that typically make up part of an estate plan for a newlywed couple:
Having a last will and testament drafted for you and your spouse by an estate planning professional ensures that your family will be protected according to your wishes. It not only provides for as to how your property will be distributed, but also allows you to choose a guardian, making sure that any children you may have or plan to have are cared and provided for. In most states it has become easy to also set up protective trusts for your spouse and children to shelter what you leave them from attack by future creditors and spouses, but these trusts must be in your will and cannot be created after your death.
A living will allows you and your spouse to make difficult end-of-life decisions for yourselves ahead of time, sparing your loved ones any guesswork when it comes to your wishes. This way, when the time comes, your spouse, children or grandchildren will not have the enormous burden of making these choices for you, and can simply follow your wishes.
Power of Attorney
In the event that you or your spouse can not handle your own financial and legal affairs due to illness, accident or being far away from your family, a power of attorney allows an individual or entity to handle these matters on your behalf. This ensures that while you are unavailable, someone you trust can keep your affairs in order. For example, if you own a house jointly, if your spouse becomes incapacitated you may need to sell the house. Without a durable general power of attorney giving you the right to sign your spouse’s name to the deed, you are not able to sell the house without involving the courts.
By going through the estate planning process your spouse and yourself will also be able to talk about those “difficult” subjects, such as the need to save for retirement or a new house in an asset-protection friendly manner or the need for life insurance to make sure your surviving spouse is not forced to sell the house or take your child out of private school.
Without a will, living will and power of attorney, decisions regarding your property, children and health care could be made by the courts, not only delaying the probate process, but also possibly dictating a division of assets or appointment of guardians for your children that is far different than your intent.
While these three documents do not encompass the full array of estate planning options available for consideration, they provide a solid framework for your family’s legal and financial future. Marital financial planning is much more than deciding, “who gets what” if the marriage dissolves. By beginning your life together with a good estate plan, you not only help avoid potential issues and expenses down the road, but also gain the satisfaction of knowing you have provided a secure future for your new family.
If you have further questions about estate planning for newlyweds, feel free to contact me for a free consultation. Wills, Trusts and Estates, It’s All We Do!