In California, it is not uncommon for people to marry more than once. Certain matters must be handled when in this situation, and one that many people forget is how to deal with drafting estate planning documents to account for the new marriage. This is especially worrisome if it is a blended family with children from both spouses’ previous relationships becoming part of the equation. There are certain issues that might be forgotten, but are not any less important.
For people who own property or have financial portfolios, the assets and income might become mixed together. Having a joint account can be beneficial to pay debts, but some people keep individual accounts as well. This is a wise decision if there are entanglements with a former spouse. Creditors generally do not care about divorce settlements if both names are on the account, so this must be considered.
California is a community property state. That means that what a spouse brings to the marriage belongs to that person, but anything acquired after the marriage is to be shared. This can be important for people who move from another state and do not understand California laws compared to those in the state of their prior residence.
In a remarriage, a trust can be essential. An example of this is if one spouse dies and the widow or widower remarries. The assets can become comingled and negatively affect a child’s share of the proceeds. A trust will also list the desires of the person in the event of certain unforeseen circumstances such as an untimely death. Children from a previous marriage might have to wait for an inheritance if this is not detailed in the estate plan.
Often, family disputes come up over a home. When there is a blended family, there could be confusion as to what happens to the property and whether the second spouse will be allowed to live in it. A home can also be placed in a trust.
Getting married a second time can be an exciting time, but there can be ancillary matters that will be at the forefront and serve as distractions to estate planning. Failing to follow up on these issues when remarrying can cause significant problems later. Speaking to an attorney who is experienced with all manners of estate plans can be beneficial to formulate a document to account for the new marriage.
Source: Forbes, “Second Marriage And Estate Planning: 5 Things You May Not Have Considered,” Mark Eghrari, June 2, 2017