Remarriage can complicate estate planning.
You are married.
You and your spouse have decided to create an estate plan.
You know it may be possible your spouse will remarry if you pass away.
What does this mean for your estate planning strategy?
According to a recent Forbes article titled “What Happens If You Pass Away And Your Spouse Remarries?,” you probably want to plan to keep the money out of the control of the new spouse while providing for your children and your spouse over another individual.
One option is to create a Family Wealth Trust.
What does this do?
When you die, your assets can be places in an irrevocable sub-trust.
Your trustee is your spouse.
Your trust beneficiaries are your children.
Does this allow your spouse to benefit from the trust?
However, he or she will not be the owner of the assets or the sub-trust.
How does this help if your spouse remarries?
The trust has a condition where the property in the sub-trust cannot be accessed if your spouse remarries with no prenuptial agreement in place.
This will better protect your assets for your own children in the event your spouse dies or divorces.
Are there other benefits?
A Family Wealth Trust will help you avoid estate taxes if you have substantial assets.
Ultimately, the trust gives the control and decision-making power for distributions to your own loved ones when you die.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.
Reference: Forbes (June 28, 2017) “What Happens If You Pass Away And Your Spouse Remarries?”