Before getting married, it is important to consider how the wedding will impact a current Houston estate plan. Second marriages often present complicated estate planning issues. This is especially true for those who have children from a previous marriage whom they would like to inherit some or all of their assets. Absent the appropriate precautions, an individual could accidentally disinherit their children altogether. Similarly, individuals may need to take action in order to ensure that their assets are used to care for their future spouse. Whatever the particulars of an individual’s situation, it pays to be prepared with a comprehensive estate plan.
Studies show that many of those who have created comprehensive estate plans have not reviewed their estate plan in quite some time. Before marriage, it is crucial to review and update all estate planning documents to make sure they represent an individual’s current wishes. To begin, those who are soon to be re-married should have a discussion with their future spouse and make sure that both parties are on the same page. Next, go through each estate plan with an experienced estate planning attorney who can translate individual estate planning goals into an appropriate strategy. Common changes may include adding or removing beneficiaries and addressing recently acquired assets.
In addition to these common changes, there are a few other considerations that may need to be made:
- Creating A Trust To Manage Certain Assets: Individuals may need to add additional documents that are better suited for their new circumstances. A trust agreement is one of the documents to consider. Trust agreements place legal ownership over a piece of property into the hands of a trustee, while allowing the owner to use the property as they see fit during their lifetime. Trust agreements provide great flexibility in managing assets, and give an individual control over how they are distributed and used upon their death.
- Texas trust agreements are useful tools for individuals with atypical family situations. For example, some may want to create a trust to hold assets for the future benefit of their children or a new spouse. A QTIP trust can be used to hold assets for a future spouse’s benefit and restrict the use of those funds following the individual’s death. The same instrument can then be used to direct the distribution of those funds upon a future spouse’s passing.
- Likewise, for those who have minor children or a child with a disability, creating a trust with separate assets to care for them is generally advisable. This will ensure that children will be taken care of without having to rely on the goodwill of a future spouse. These are just a couple of examples of how a trust can be used to address concerns unique to a second marriage. However, with the right professional, the possibilities are seemingly endless.
- Update Beneficiary Designations: Reviewing beneficiary designations on all accounts and insurance policies is also an important step. Like estate plans, few of us think to review this information as frequently as we should. However, it is critical to check it before or after major life events to make sure the right people are named as beneficiaries. Doing so can help to avoid disastrous consequences. Consider, for example, the chaos that would ensue if the benefits of a primary life insurance policy went to an ex-spouse instead of a future spouse. In such a situation, there is very little that could be done to correct such a mistake after the fact. The only solution is to avoid such a problem from the outset by updating beneficiary designations.
- Discuss Getting A Prenuptial Agreement: A pre-nuptial agreement is not typically considered an essential estate-planning document. However, for those in Texas planning to get married for a second time, it can be very important. Texas is a communal property state, which means any property gained by one spouse during a marriage is the property of both spouses. This includes increases in value on property owned before the marriage. A pre or post nuptial agreement allows spouses to set their own rules regarding ownership of property acquired during their marriage.
An Experienced Houston Estate Planning Attorney Can Create An Estate Plan That Meets Your Specific Needs.
As mentioned above, it is critical to review your estate plan with an experienced attorney prior to your second marriage. McCulloch & Miller, PLLC is a Houston estate planning law firm with the skilled attorneys to meet your needs. We can create an estate plan for you that accounts for your unique family circumstances. Contact our office at 713-333-8900 to schedule a free consultation with an attorney on our team