On behalf of The Law Offices of Mary Ann Beaty, PC posted in Prenuptial Agreements on Friday, August 5, 2016.
Second marriages could have more financial complications because some couples enter their new marriage with children and they likely attained more assets and resources as they got older. Four out of 10 new marriages had at least one spouse that was married earlier, according to a 2013 Pew Research study. Drafting a prenuptial agreement is even more important to protect assets and for estate planning when couples remarry.
Property division and planning for remarriage is becoming more important. Divorce in this country has increased over the last 56 years, which has led to more remarriage. Life spans have grown, providing more time for remarriage after divorce or the death of a spouse. As spouses age, they often have greater income and assets and become more financially secure.
It may be advisable for couples entering second and third marriages to keep their assets that they brought to the marriage separate and share only what they earned and attained as marital property during their new marriage. Also, a prenuptial agreement makes both spouses fairly and accurately identify their individual assets when they remarry which helps them prove what they brought into the marriage in any divorce proceedings.
Prenuptial agreements also identify the assets that a deceased spouse’s heirs would inherit. This agreement may be considered an important estate planning document along with life insurance policies, a will, trusts, pension and retirement plans and documents identifying beneficiaries. Prenuptial agreements may provide better protection than wills because wills are utilized for the death of a spouse while a prenuptial agreement is part of estate planning and divorce.
A spouse who enters another marriage with more assets than their other spouse can utilize the prenuptial agreement to form a trust that will pay interest to their new spouse for the remainder of their life. When that surviving spouse dies, these assets may then go to the children of the first spouse who died. This plan is particularly appealing to couples with greater net worth.
Spouses considering a prenuptial agreement before remarriage may wish to receive independent legal advice to protect rights. Legal representation can help assure that the agreement will meet their financial needs, provide for accurate disclosure of assets and help assure that their heirs receive their just inheritance.
Source: Pittsburgh Post-Gazette, “Financial planners: Prenuptial agreements shouldn’t be a deal breaker in remarriages,” Tim Grant, July 29, 2016