Death, divorce, incapacity and estate planning are issues that young couples rarely spend a lot of time thinking about. However, taking the time to create an estate plan after the honeymoon can go a long way toward ensuring that the happy couple will be prepared for the bumps in the road that will inevitably arise.
1. Basic Estate Planning is for Everyone.
If you are over the age of 18 and have assets in your own name, you need a Will. Your Will does not control assets for which you already have beneficiaries designated (i.e. life insurance, 401K, etc., see Tip #3 below), but controls assets such as real estate, bank accounts, investment accounts, your car, jewelry, etc. If you die without a Will, state law will determine who receives your assets, which may or may not be consistent with your wishes. Other good reasons to complete an estate plan as soon as you get married: (1) if you have children from a previous marriage and want to protect their inheritance (2) as children are born you can designate a guardian in your Will; (3) if you purchasing a home together you can save time and money in the future by ensuring that you make an informed decision on how to take title in the first instance.
2. Consider a Pre-Nuptial or Post-Nuptial Agreement to Protect Assets.
A pre-nuptial agreement is an agreement between two people intending to be married as to how their assets will be divided between them in the event of a divorce. Post-nuptial agreements can be particularly effective in a limited way to ensure that if either spouse receives gifts or an inheritance, those inherited assets will remain the property of the spouse who inherited those assets and will not be subject to division in the event of a divorce, if that is the couple’s desire. Full disclosure of assets and separate attorneys for each party are among their requirements for a valid pre- or post-nuptial agreement in New York State.
3. Don’t Forget to Change Your Beneficiary Designations.
Your Will only controls assets that you own in your individual name. Wills do not control assets for which a beneficiary is designated, such as life insurance policies or a retirement account. For many people, life insurance policies and retirement accounts are a significant portion of their assets. When reviewing your estate plan in light of a new marriage, we can help you review the beneficiaries designated to receive these assets in the event of your death, and change them if necessary to properly reflect your wishes (for example, if you have a child from a prior marriage). Please keep in mind that under the New York Estates Powers and Trusts Laws you need a spouse’s consent to change a beneficiary on a 401K or 403b plan.
4. For Richer, For Poorer, In Sickness and In Health.
Powers of Attorney and Health Care Proxies. These documents are critical estate plan documents that allow you appoint your spouse (or another individual) to make financial or health care decisions for you in the event you are incapacitated or otherwise unable to make those decisions for yourself. These documents will in most cases avoid a protracted and expensive guardianship or conservatorship proceeding. In addition, the HIPAA Authorization form gives your physician and other health care professionals permission to speak with your spouse or fiancée and is essential if you want your loved one to have access to information about your medical condition or prognosis in the event of an unexpected medical event. The importance of these documents in avoiding the added stress and delay associated with a court proceeding under what are often difficult circumstances for family members cannot be overstated.
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Betensky Law PLLC
118 N. Bedford Road, Suite 302
Mount Kisco, New York 10549
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