Three Estate Planning Tips for Newlyweds

Congratulations on your upcoming or recent marriage! You have spent time and care planning your wedding and honeymoon, now is a great time to evaluate your estate plans. Now that you have legally joined your lives, it makes sense to have a comprehensive North Carolina estate plan that addresses both of your estates and any joint property that you have. Taking time to focus on your estate plan will help you and your spouse significantly in the long run.

Update or Create Your Wills

Unfortunately, many Americans do not have any estate plan or even a last will and testament. Most estate plans are either will-based or trust-based. A will is a legal document that lays out what you would like to happen to your property upon your death. Some couples prefer to create “I love you wills” for each other. Each spouse leaves their entire estate to the other spouse and then to their children upon their death. One advantage of this type of will is its simplicity.

If you have a lot of different properties, a trust may be more advantageous for you. You and your soon-to-be spouse can place all of your assets into a trust that will remain private. Many married couples create a living trust. One advantage of a living trust is that you and your spouse can amend it or revoke it during your lifetime. If you purchase more property or sell property, it is relatively easy to amend the living trust.

Upon death, the trust becomes irrevocable, and the trust beneficiaries may not alter the trust provisions. Your trust will not be subject to going through the probate process upon your death. Trusts are beneficial because the beneficiaries you choose to inherit you and your spouse’s property will not have to go through a lengthy and costly probate process. Instead, they can automatically have access to the funds in the trust to help pay for the funeral costs and medical costs.

Create a Prenuptial Agreement

More couples than ever are choosing to create a prenuptial agreement before they get married. Prenuptial agreements are no longer only used by celebrities or wealthy couples. In a prenuptial agreement, you will establish how your property will be divided should one spouse pass away or should the spouses get divorced. The agreement will also set out whether one spouse will receive alimony. The following types of people should consider signing a prenuptial agreement:

• Those with an ownership interest in a family business
• Those with children from a previous marriage
• Those with significant financial obligations or debts
• Those with a wealth disparity, such as one person, has significantly more assets than the other spouse
• Those who are beneficiaries in a family trust

Update the Beneficiaries on Your Accounts

Many people forget to update the beneficiaries for accounts that are “payable-on-death.” Take a look at the following accounts and make your spouse the beneficiary if you would like to do so.

• Health Savings Accounts
• Investment Accounts
• Retirement Accounts
• Insurance Policies
• Bank Accounts

Sit down with your spouse and discuss which accounts you have, and discuss what you would like to do if you both pass away at the same time. You may want to agree on a second beneficiary after each other. It may be wise to make a list of all payable-on-death accounts. If one spouse passes away, this information will make a difficult situation less stressful for the surviving spouse.

Name Your Durable Power of Attorney

A North Carolina durable power of attorney is a legal document that allows someone you designate to make decisions for you on your behalf if you become incapacitated. For example, let’s say you become so ill that you cannot make decisions for yourself. Your power of attorney will step in and decide which procedures you will have and which life-saving measures doctors can take. Your North Carolina durable power of attorney needs to be signed by yourself and two witnesses and notarized.

Reach Out to an Attorney for Help

Hiring an attorney to help you and your new spouse can be advantageous. Why not start your new life together with updated and skillfully written estate planning documents? The experienced North Carolina estate planning attorneys at Arnold & Smith, PPLC, are here to help. Contact us to set up your appointment today.