Start by knowing all your existing obligations, King and Hedges suggest, including:
- alimony payments
- child support
- responsibility for college tuition payments
As estate planning attorneys, we remind our remarried couple clients that, if not waived in a prenuptial agreement, a surviving spouse has a legal claim against a portion of the spouse’s estate, and that claim has priority over the bequests made in the will (very much like the claims of a creditor).
Spouses automatically becomes the primary beneficiaries of each other’s spouse’s ERISA retirement account. Pre-retirement, neither spouse can choose otherwise without the other’s consent. In an annuity payout, the form of payment must be a joint and survivor annuity. If a spouse wishes to leave his or her qualified retirement plans to a beneficiary other than the spouse, the prenuptial agreement should address this issue and provide that the spouse agrees to execute a consent to allow a different beneficiary on the plan.
Estate planning needs to include powers of attorney. In the absence of a power of attorney appointing a different decision maker, the current spouse has the highest priority to serve as a guardian over the assets and over the person of an incapacitated spouse.
Prenuptial agreements must cover three possibilities:
Planning for step-families is both highly complex and highly rewarding (for us as advisors, but also for the newly blended couple themselves. “Enable family members you trust to provide for future generations. Think ahead,” advise King and Hedges.
- by Rebecca W. Geyer