Second Marriages: Prenup to Estate

Posted by Victor Dela Casa

Bouncing back from a divorce and marrying a new-found love can be an exciting time for anyone. For many, a second marriage closes the book on the previous marriage and the pain of divorce. But a second marriage brings with it other legal issues and property division concerns. Remarrying partners will do well to reassess their properties and other finances well prior to the marriage.

Experts advise such couples to have a detailed and well thought-out prenuptial agreement and estate plan. Being specific about what is owned before a second marriage can spell the difference between finding happiness and being twice broke and twice broken-hearted.

Until recently, prenuptial agreements were not a popular topic among couples. Thanks to celebrity weddings that often go south, we have learned that a so-called "prenup" is a necessary and effective tool. It is a legally binding agreement that fully discloses each spouse's finances, and it should be signed and witnessed relatively far in advance of the big day.

The agreement also sets forth exactly what each party is entitled to in case the marriage winds up in a divorce. It usually has a payout provision, by either cash or an asset acquired prior to marriage. Conjugal or marital properties-properties acquired during the marriage-are divvied up by the court in accordance with state divorce law.

Even if the second marriage does not end in divorce, the death of one spouse could start a bitter legal battle among the children. This is why tools like wills, trusts and designating beneficiaries should be set up prior to marriage and/or death. Designating beneficiaries will ensure that the intended persons receive the assets upon death in accordance with the testator's wishes. All other properties owned jointly with the spouse will automatically be awarded to the spouse.

Those who want to provide for both the surviving spouse and all the children, including those from a first marriage, should look into a qualified terminable interest property trust (QTIP). This type of trust allows the surviving spouse to get the trust income until he or she dies, and then the children inherit it.

Some states have laws that prevent testators from leaving a spouse out of an inheritance. Elective share laws allow one's disinherited widow first rights on one-third of all assets over all other parties. With all of these legal issues, it is highly advisable to have an estate plan finalized well in advance of the wedding day.

(Written by Vee Dela Casa for D.W. Trombadore, New Jersey Attorney-At-Law, Feb. 4, 2013. For the U.S. published version, click here)

About The Author

Victor Dela Casa is a Filipino-Canadian who spent over a decade working as a business professional in Canada. Worked in IT, finance, marketing, international trade, public service, project management and the maritime industry. Degree in Economics from the University of the Philippines and Honours Diploma from Eastern College. Currently based in the Philippines and working as a professional writer for a multi-national business processes firm.