You are getting married — for the second time. While everyone is congratulating you on finding love again, your children are encouraging you to complete a prenuptial agreement. Why are your children so concerned about your new life? Are they overreacting?
Most children who have experienced a parent in a second marriage attest it is a time of happiness and excitement. They want their parent to be happy, but there are many underlying concerns that can be a white elephant in the room during conversation. For instance, children from a previous marriage may feel threatened their perceived “inheritance” will go to the new spouse or the new spouse’s children. In addition, your partner’s asset-to-debt ratio may not be favorable, and your children’s concern may be your assets will be depleted paying debts not incurred by you. You may both own homes and need to decide which home you will reside in. There will be questions about taxes, upkeep, and whether the new spouse will continue to live in the home after the other has passed away.
One way to keep your premarital assets and debts clearly separate is by entering into a Prenuptial Agreement before marriage. Prenuptial Agreements, like any contract, must be clearly written. They must be voluntarily signed by both parties, and provide a reasonable disclosure of the property or financial obligations of both parties. Without a prenuptial agreement, a surviving spouse may have the right to claim a large portion of the other spouse’s property, leaving less for the surviving children which will likely be less than you originally intended. Litigation related to Prenuptial Agreements almost always centers on whether the terms of the agreement are clear, the agreement was signed voluntarily, and if the disclosure was reasonable. For this reason, we recommend both parties retain their own attorney to review the Premarital Agreement.
In addition to a Prenuptial Agreement, you should also consider updating your estate plan. Estate planning challenges in second marriages can be solved with a combination of good communication and smart planning. Creation of a trust is one way to provide for a new spouse after the death of a spouse while preserving the balance of the assets for the deceased spouse’s children. Utah law provides a default estate plan applicable to Utah residents in a second marriage with children from a prior marriage who fail to take the time to prepare a customized estate plan. Generally, Utah’s intestate law provides that the surviving spouse could be entitled to the first $75,000, plus one half of the balance of the deceased spouse’s intestate estate. The children of the deceased spouse receive the balance of the deceased spouse’s intestate estate. There are several exceptions in this law; you should seek legal advice from a competent estate planning attorney concerning your situation.
Congratulations on finding love again. Let us help you preserve the peace in your home and with your newly extended family by assisting you with a Prenuptial Agreement and other estate planning documents.