From 'I Do' to 'What If': Estate Planning Must-Do's for Newlyweds - Part 2
Newlyweds: Essential Estate Planning for Your Future
Getting married and starting a new chapter in your life is an exciting time. It’s also a period that requires a lot of logistical tasks, such as updating your address, changing your tax filing status with your employer, and adding your new spouse to your bank and credit card accounts.
However, did you know that creating (or updating) your estate plan should also be on your post-wedding to-do list?
Last week, we explored the key estate planning components every newlywed couple needs to protect their rights, wishes, and plans for their assets now and in the future. This week, we continue the conversation with three more estate planning must-do’s for newlyweds. If you missed last week’s blog, be sure to catch up.
4. Establish a Living Trust
Are you surprised to see a Trust on our list before a Will? Here’s why a Trust is crucial. Whether you're starting your marriage young or later in life, a Trust ensures your wishes for your assets and new family are honored during your lifetime and after your death.
With a Will, assets must pass through a court process known as probate before they can be transferred to your spouse or other beneficiaries. This process can be lengthy and may lead to conflicts between your spouse and other family members. A Will only governs the distribution of assets upon your death that aren't already covered by a Trust or beneficiary designations.
A Trust, however, doesn't require court involvement, allowing you to set parameters for asset distribution over time. For instance, you can safeguard assets in the Trust until your children reach a certain age or ensure your new spouse is supported during their lifetime while your remaining assets revert to your children after their passing.
Using a Trust can help eliminate conflict between step-siblings or between your children and your spouse. Even for adult children, a Trust provides a lifetime of asset protection from creditors and lawsuits.
Ultimately, a Trust allows you to create a custom plan for your assets, ensuring they are carefully managed and your goals for your loved ones are met even after you’re gone. You can establish contingencies and incentives in your Trust, such as requiring a sibling to seek counseling or a child to pursue education before receiving distributions.
5. Create a Will
A Will designates who should receive any assets not included in your Trust or covered by beneficiary designations. Ideally, your Trust will encompass all assets, but a Will ensures forgotten assets are “poured over” into your Trust and distributed according to its terms.
If you don’t have a Trust, your Will dictates asset distribution through probate. Your Will can also direct charitable donations and create a Trust upon your death if circumstances require, such as a disabled heir.
Having a Will, even if you think you don’t need one, is essential. Without it, state law may dictate asset division, potentially against your wishes. Always create or update your Will when you get married.
6. Appoint Legal Guardians for Minor Children
If you or your spouse have minor children from a previous relationship or plan to have kids soon, selecting and legally documenting guardians for your children is crucial. Guardians are legally named to care for your children if you or your spouse die or become incapacitated.
To ensure your children are never left with strangers, name both long-term and short-term legal guardians. This guarantees someone you trust can care for your children during emergencies or long-term situations.
Don’t assume godparents or nearby grandparents automatically have the authority to care for your children. Only by naming guardians in a legal document can you ensure your children are cared for by those you choose, avoiding conflict and lengthy court processes.
Planning for a Lifetime of Happiness
If you’re newly married or planning to marry soon, it's essential to protect the dream and future you're building with your new spouse. With the excitement of your wedding, now is the best time to create an estate plan for your new family.
Incapacity and death can affect newly married couples just as much as long-married ones. The ramifications of not having an estate plan in place can be even worse for new couples.
No matter the stage of your relationship, make sure your spouse and family are protected and cared for now and in the future. Establishing a comprehensive estate plan ensures your wishes are honored and your loved ones are secure.
Plan wisely and ensure your new life together starts on a solid foundation.
To learn more about how I can help protect your family’s future, schedule a free 15-minute discovery call today.
Here’s to a very happy ever after.
This article is a service of Zarda Law, S.C. We do not just draft documents; we ensure you make informed decisions about life and death, for yourself and the people you love. That's why we offer a Legacy Planning Session, during which you will get financially organized and make all the best choices for the people you love. You can begin by scheduling a Legacy Planning Session and mention this article to find out how to get this $750 session at no charge.
