There are numerous money myths that you’ll hear when you consider getting married at midlife, particularly if your spouse-to-be has children from a first marriage. Here are six common myths from Forbes’ recent article entitled “6 Money Myths About Marrying After 50”:
1: Prenups Are Just for The Rich and Famous. This is not true. If you’ve been married before and have children from a previous relationship, a prenuptial agreement is important to ensure that your assets will pass to your children from the prior marriage. What about a first-time marriage? There still might be a need for a prenup, especially if you own significant assets. Don’t think of a prenup as preparing for divorce, but rather more like writing your will. If you don’t have your affairs in order, the state will decide for you—just like dying without a will. After age 50, the focus of a prenup should be on protecting your children and grandchildren. For instance, some states allow a surviving spouse to claim his or her “elective share”, instead what’s in the decedent's will. A prenup allows your spouse to waive the elective share. That means the odds are that your estate plan won’t be challenged by your surviving spouse.
2: Don’t Talk Estate Planning with Your Stepfamily. Estate planning is critical when you have children from an earlier marriage. Otherwise, your entire estate could pass to your new spouse and not to your own children. Have a candid discussion about your estate planning and prenup with your adult children and your new spouse. This will alleviate some of the concerns adult kids may have about how it will affect their inheritance, when their parent gets remarried.
3: Holding Assets Jointly Is Always Preferable. Long before getting married, couples should decide on whether they want to have separate or joint accounts and if one will sell his or her current home. If one of you sells their home, will the deed to the house you live in be changed to reflect join ownership? It is best to have these discussions before the wedding ceremony.
4: Your New Spouse’s Debt Won’t Impact You. This is a big one. Marrying a person with a large amount of debt, whether it’s college loans or credit card debt, can be a major issue in second marriages. Therefore, spouses should be upfront and candid about their debts before marrying. That way they can plan how to address the debt.
5: It Always Makes Financial Sense to Get Married. This is not always true. It depends on your personal and financial circumstances. Tying the knot may reduce your Social Security benefits, especially if you didn’t work while you were married the first time and can claim spousal benefits that are much higher than your own Social Security benefits. If you have an ill or disabled partner on Medicaid, then you might want to stay unmarried so he or she can to continue to qualify for benefits. The combined marital income might make your partner ineligible for Medicaid.
6: Your Spouse Automatically Has a Right to Make Your Medical Decisions. This statement is not true. If there’s no advance health directive in place that details your wishes regarding end-of-life care, it’s not a certainty that your new spouse will be able to make medical decisions for you or tell your doctor what treatment you’d want. You should be clear in writing what your wishes are, so your new spouse and your adult kids will not fight over your care. Talk with your new spouse and your adult children, so they know your wishes and set up an advance health care directive. This should be part of your estate plan, which should also be revised to reflect the new marriage.
Reference: Forbes (February 13, 2017) “6 Money Myths About Marrying After 50”