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Divorce at any age can cause a blow to your finances, but if you’ve already been married and divorced, there is another level of financial discussions that need to be addressed before you remarry.
One of the reasons we offer pre- and post-nuptial agreements is for this very reason. Having one—and going through the process—allows for true financial transparency between partners. These negotiations are particularly important when marrying for the second or third time.
Sit down with your future spouse and talk about finances. Look at all your finances before you enter into the documented world of marriage and combined assets. Begin with a simple discussion about your assets and liabilities. Couples also need to discuss their financial goals and philosophy and share information about financial challenges, as uncomfortable as it might be.
Make sure your estate plan is up to date. You need to be extra cautious if you have children from a previous marriage. You want things to work out with your current spouse and also make sure your kids are not disinherited. Clearly spell out the assets you plan to allocate to your children or other heirs. Make sure the beneficiaries on accounts are set up and that trusts specify who gets what and why. There are plenty of ways to be fair to the new spouse and preserve assets for your heirs.
Update your will. Your will and beneficiary designations need to be updated for many major life events, including the birth of a child, death of a family member, marriage, divorce, and remarriage. As you age, it becomes more important to have a plan for the possibility of one spouse passing away before the other and to set up documentation for potential health care decisions.
Consider a prenup or a postnup. Prenuptial agreements can protect both spouses—but especially the one with more assets. Anyone getting married who has any assets to protect should have a prenup. This document should spell out what happens to the properties owned by each spouse and any retirement accounts they are each bringing to the marriage. It’s equally important to address any significant debt each partner has acquired. Prenuptial agreements can also help prevent conflicts between children and the new spouse in the event that a parent passes away.
Review all your documentation. If you are entering your second or third marriage, you may need to make significant changes to your estate plan, beneficiary designations, and even your emergency contacts. Make sure that all the documents you leave behind clearly spell out your wishes. Take the time to do proper estate planning, because a prenup may say one thing and your estate plan may say something different.
For more information and to schedule your free consultation, please call The Law Offices of Steven B. Chroman, P.C., at (661) 255-1800 or visit us at www.chromanlaw.com.
Mr. Chroman is a Trusted Advisor Award Winner and named Top 100 California Attorney with over 20 years of experience and local service. You can purchase Mr. Chroman’s best-selling Divorce Workbook at www.amazon.com/Preparing-Divorce.
This article was originally published in Santa Clarita Magazine as part of our firm’s mission to make family law information more accessible to the Santa Clarita community. Read the full feature and others at santaclaritamagazine.com.