For couples who get together and are of similar ages, planning for the future is usually a joint effort. Couples who have a significant age gap may have different plans for the future, however. If you are married to someone who is significantly older or younger than you, the future may look different and require different types of planning. To protect yourself, your spouse, and other loved ones in your family, It’s important to get a comprehensive financial and estate plan that makes sense for you. For these plans to work in the long run, it starts with having an open and honest conversation with your significant other about the following financial and estate planning topics.
Employment and Retirement
You or your spouse may rely on a job to provide health insurance and income. On the other side, you or your spouse may be thinking about retirement and a job can take up a large amount of your time. When talking about this subject with your spouse, keep the following questions in mind:
- Are either of you currently working? If you are both working and bringing in an income, your lifestyle may change if one or both of you decide to retire or stop working soon.
- After both of you are retired or no longer working, what do you want to do with your time? If one of you wants to travel while the other wants to start a business, there may be a conflict regarding the time you spend together as a couple in a few years.
Managing Your Finances Now and Down the Line
Retiring or stopping employment means losing a source of income. For many, social security is not enough, and they expect their retirement accounts to provide a large portion of the money they will need during retirement. However, this setup does not happen overnight, and it takes advance planning. It is important that, as a married couple, you discuss the following topics now to ensure your financial security later:
- If you are currently working, when do you see yourself retiring? If you are planning to retire soon, it is crucial to meet with your financial planner to make sure your finances are in order and that you can afford to stop receiving a paycheck.
- Is there a time when both of you will be retired or not working? Depending on your current income needs, will you have enough money from other sources to support your lifestyle if neither of you is working?
- Do you have a plan for when you are going to withdraw the required minimum distributions from your retirement accounts? If you are unsure what that is or when to do so, talk with your financial advisor. They can advise you on the best strategy for your particular situation and desires for the future.
- Is the younger spouse hoping to use the retirement funds from the older spouse for their lifestyle and future living as well? Is there enough money to do so?
Estate Planning Considerations
Crafting an estate plan is the best way to guarantee that those you love are taken care of when you become incapacitated or pass away. If you do not create your own estate plan, your state’s laws will determine who gets your money and property, and how much, when you die. Every state is a little different when it comes to determining who will make decisions for you in the event you cannot make them for yourself. But you can help control what you want to happen if you put the right plan in place. As you review or begin your estate plan, keep the following questions in mind:
- Who will serve as your trusted decision-makers (executor or personal representative, successor trustee, agent under a financial power of attorney, and agent under a medical power of attorney)? Because of your age difference, it is important to be realistic about the future and name alternates to these positions in the event your first choice (usually your spouse) cannot act on your behalf. If you have children from a previous relationship, you will also want to plan if and in what order you want to name them for one of these important decision-making roles.
- Whom do you want to name as your beneficiary upon your death? If that person is your spouse, do you want them to receive the inheritance outright or in trust? If you want to give an inheritance to your children, will this be available immediately upon your death or unavailable until after your surviving spouse’s death?
- Do you have children from your current marriage? Will they be treated the same as children from a previous relationship, or will they receive preferential treatment? How will all of this be laid out in your estate plan? That’s where working with a well-qualified estate planning attorney becomes important.
These are just some of the estate planning questions you and your spouse should be discussing as you plan for your future. If you have any questions or are ready to take the next steps in creating or updating your estate plan, give us a call at 702-731-2333 for a consultation with one of our estate planning attorneys.