Married people over 50 are getting divorced more than ever before. They’re also remarrying in many cases. That’s one reason older adults in New York need to be aware of estate planning considerations for people entering a second or third marriage. If people aren’t careful, they may disinherit their current spouse or their children. They also risk inadvertently including former spouses.
Updating an estate plan
It’s important for people to consider updating their wills and the beneficiaries on their insurance policies and retirement plans. Qualifying events for work-provided policies include the birth of a child and a new marriage. Typically, current spouses are the beneficiaries of 401(k)s. It is possible to leave these to children, but the spouse needs to waive their right to inherit for that to happen.
Without updating beneficiaries, it’s possible for a former spouse to inherit as the beneficiary of a life insurance policy. These are binding contracts and don’t have any real relationship to a last will and testament. Even if the will stipulates that the estate should go to the current spouse, a life insurance policy can supersede that.
Some older adults don’t formally include their children in their estate planning because they believe that their current spouse will make provisions for them. This doesn’t always happen. If parents want their children to inherit, they should make sure they have planned for that. It’s possible to make provisions in a will or create trusts to ensure that the children are provided for.
The way to make an estate plan, especially for a complex family, is with help from an attorney. Experienced lawyers understand how to manage estates and create comprehensive estate plans. Proper estate planning can be expensive, but it often saves money in the long run.