"People think estate planning is for very wealthy people," says Larry Luxenberg, a financial adviser with Lexington Avenue Capital Management in New City, N.Y. "But neglecting to plan can cause conflict after one partner's death."
Getting your financial future in order is a great way to strengthen a new relationship. Having these discussions early "makes the marriage a lot more positive," Nel says, "and you can concentrate on being happily in love again."
For those collecting Social Security benefits, a number of issues need to be considered, Luxenberg says -- particularly if either or both partners have been married before. "New couples who are already retired might think the die is cast," he says, "but there are still lots of considerations."
"Medicare is means-tested," she says, meaning that premiums for some benefits increase according to a person's ability to pay. "So if you are marrying someone with a lot of unearned income, talk with an accountant about multiyear tax planning."
Given the complexity of Social Security regulations, Nel says, checking with an expert before saying "I do" is a smart strategy. "There are some quirky issues that could come up."
"That includes life insurance policies, IRAs, pension plans, 401(k) plans (and) annuities," he says. "Many brokerage accounts have a payable-on-death (POD) clause that needs to be changed. Issues related to trusts should be revisited. All of these things can come back to bite you."
Very often, says Joseph R. Birkofer, Legacy Asset Management's principal and founder, people neglect to make those changes -- and the ex-wife remains the beneficiary.
"Generally speaking," Birkofer says, "the courts uphold the named beneficiary. It's hard to contest."
If the former spouse is deceased, Armstrong adds, "It goes to the estate -- and that causes a tax disaster."
"Often there is a house or some other real estate that used to be jointly owned," Armstrong says. "Do you want it to be jointly titled or own it alone? Should it go into a trust so that it goes to your named beneficiary as opposed to the new spouse?"
"Do-it-yourself estate planning can get people into trouble," says Birkofer. "A good estate plan should cost no more than a few thousand dollars at most, and it can save a lot more than that."
"While it's perfectly conceivable that a marriage at 60 will last as long as a marriage that began at 20," Birkofer says, "the medical and care consequences of an elder marriage are far more dramatic than midlife or early-life marriages.
An important discussion to have is what each of you expects the next 30 years to look like. It doesn't have to be confrontational. Latter-year issues such as long-term care insurance and living wills are very common."
Very often, Armstrong says, a new husband may want to make sure that should he die before his new wife, she will be taken care of in her final days -- but he doesn't want his assets to go to her children.
"A QTIP allows me to assign all or some of my assets to a trust that will take care of my wife for the rest of her life," Armstrong explains, "and then go to another person or institution.
"It doesn't get taxed in my estate because it's a gift between spouses," he says, "but she doesn't have the right to give it to someone else. It's not part of her estate."