More Americans are now getting married over the age of 65 than ever before. And even though this may be a second or third marriage for many, caregivers should nevertheless be aware of certain aspects that shouldn’t be ignored amidst all the wedding plans and celebrations.
Your financial life changes drastically once you get married, and your previous estate planning may have to be adjusted to accommodate your new spouse and/or dependents. Pre-wedding planning can make a huge difference at a later stage. The organization of assets, wills, life insurance policies and financial accounts are vital. Also, remember that laws vary by state, so it might be a good idea for you and your loved to consult a financial adviser or lawyer to help you work through these matters.
Seniors are often more set in their ways when it comes to their financial lifestyles, and have often had time to build up assets. This could make it complicated to merge assets and finances, especially when one partner is a little less frugal than the other, or when one partner has significantly more money than the other.
There’s also the issue of children from previous marriages, which may bring up a whole new set of problems. When money is pooled, issues of inheritance should be meticulously clarified. Clever planning can help to eliminate problems or at least to simplify the process. Before you walk down the aisle, connect with a financial planner for more information.
Wills and trusts
In case of a death or divorce, a prenuptial agreement can be invaluable. This document can often prevent one partner from challenging the other’s will and existing trusts. Investigate whether or not your loved one would benefit from a qualified terminable interest property trust (QTIP), which provides support for both your spouse as well as protection for your first family. If the spouse dies, the entire trust will then move over to the parties you choose, including children from your first family.
Many experts also recommend separate wills for those who marry later. This will ease difficulties with the distribution of assets, especially considering that circumstances may change.
Another important part of changing wills is to ensure your power of attorney is updated, including one outlining your health care decisions. Beneficiaries should also be updated for life insurance policies.
Long-term care planning and housing
Even if your loved one and their new partner are healthy now, realize that one or both of them may need long-term care at some stage. Being an elderly caregiver to a loving yet ill spouse can be highly stressful and exhausting, and sometimes physically impossible. Therefore, necessary funding for care planning and alternative housing must be considered, so make sure this becomes part of your financial planning!
The moment your loved one gets married, encourage them to update the Social Security Administration with any name change and to ensure that earnings are reported. If your parent gets married after their full retirement age – and the benefit they get is less than their spouse – they may be able to move their Social Security benefit up to 50% of the spouse’s Social Security, which means they will receive a larger benefit. If they’re receiving any divorced spousal benefits from a previous partner, however, this will fall away.
Take also into consideration that if your loved one is receiving survivor benefits, these will not be available to a husband or wife who marries before the age of 60. They may, however, still receive these benefits after 50 if they’re classified as disabled.
Your loved one’s Medicaid benefits can be vastly affected by a new marriage. If they marry someone with an income higher, their Medicaid benefits will be significantly reduced or cut altogether. Ensure to check the rules about Medicaid before the marriage to find out how their new spouse’s household income will be affected by a new marriage.
YOUNG AND OLDER CHILDREN IN A SENIOR MARRIAGE
A lot of people are surprised to learn that stepfamilies formed after the marriage of two senior parents with adult children also may struggle with the transition, just like younger children. Adult children may fear their entire inheritance may be bestowed upon the new spouse and their children, which can cause resentment.
Older stepparents of adult stepchildren may also feel threatened by one another, and the entire family dynamic could be affected through this type of friction. Finding middle ground could be very hard.
To help ease the transition, both stepchildren and parents should keep communication channels open and should educate themselves on how to live with a stepfamily. Family counseling can also be a good idea to help all parties work through the myriad emotions. While the transition can take a while, it is possible to come to some sort of agreement that will do away with most of the animosity!