There are few things in life as exciting as getting married. After the chaos of wedding planning, the last thing you want is another task on your to-do list. However, in light of this exciting event, there are several things you should be mindful of to make sure that the legal and financial parts of your life properly reflect your newly married status.
Changing Your Name
Firstly, if you decide to legally change your name, you must notify important institutions beginning with the Social Security Administration. This will then allow you to do things like obtain a revised driver’s license with the Department of Motor Vehicles, update your name on bank accounts, and get a new passport, to name a few.
You must also be sure to contact your employer, creditors/debtors, insurance agencies, and utility companies to notify them of the name change. Secondly, if you are planning to move or have already moved, be sure to update the institutions with your new address.
Insurance Changes
After taking care of those changes, evaluate adding your new spouse to your health, dental, automotive or other insurance plan, if necessary, or having that person add you to their policies. In some instances, it may bode well to have both spouses on the same policy. Always speak to your agent to determine if the changes are right for you and your spouse.
Taxes
Another important thing to consider after getting married is the impact that your marital status may have on your taxes. It is very important to speak to a tax professional regarding any changes that may need to be made to your withholdings and to discuss whether to file your taxes separately or jointly. Early preparation for this is best so that there are no surprises when it comes time to file your taxes. The last thing that any newly married couple wants to do is pay a hefty tax bill!
Estate Planning
Even in the bliss of being newlyweds, you should begin to prepare for the inevitability of death and/or incapacitation. It is very important to have a plan in place just in case something unexpected were to happen. Make sure you speak to your new spouse about your wishes and to listen to their wishes in return.
It is also very common for newly-married couples to purchase life insurance shortly after tying the knot. Life insurance is extremely important to make sure that, in the event of a spouse passing away, the surviving spouse will be able to have sufficient resources to take care of themselves and/or any surviving children. If you already have life insurance coverage, make sure to designate both a primary and contingent beneficiary. Also make sure your spouse knows of the existence of the life insurance policy.
Beneficiaries should also be designated for 401k’s, IRA’s, annuities and other investment accounts, if you have them. Beneficiaries should always be updated and/or evaluated after major life changes, such as a marriage. It is recommended to update beneficiaries sooner rather than later after a major life change to ensure the correct people are listed and your wishes are honored, just in case something happens to you.
Lastly, every newly-married couple should make it a priority to meet with a knowledgeable estate planning attorney shortly after tying the knot. The attorney will prepare documents that may include the following:
- Durable General Power of Attorney: this document names an agent to assist in handling financial affairs in the event that you are unable to do so on your own, for reasons such as an extended absence or incapacitation. Most married couples name their spouse as their agent and then choose an alternate in case something happens to their spouse. The alternate can be an adult child, a parent, a sibling, etc. You may want to make sure it is someone you trust and that you let that person know that you have appointed them as your agent.
- Health Care Power of Attorney: this document names an agent to make medical decisions for you in the event that you are incapacitated and unable to make those decisions for yourself. Most people name their spouse as their agent then choose an alternate in case something happens to their spouse. The alternate can be an adult child, a parent, a sibling, etc. Like with the durable general power of attorney, make sure it is someone you trust and that you let them know you have appointed them to this role.
- Advanced Directive for a Natural Death/”Living Will”: this document provides a guide to your health care agent and physicians regarding your wishes for life-saving measures. In this document, you can dictate whether or not you wish for your life to be prolonged by artificial methods in the event of a traumatic illness or injury when the chances of recovery are slim to none. You will also want to make sure your health care agent is aware of your wishes that you name in the document, just in case a medical professional turns to that person for confirmation.
- Last Will & Testament: this document serves several purposes. Firstly, this document will detail how you wish for your property to be disposed of when you pass away. Almost always, married couples will leave everything to their spouse and then choose an alternative option in case something happens to their spouse. This document also names Executors. An Executor is the person named to handle the affairs of the Estate upon the death of the Testator (person who made the Will). A Guardian can also be nominated in the event that you already have children or are planning to have children in the future. Guardians are people who take care of minor children when both parents pass away. For a lot of people, this is the most important reason to have an estate plan. Without a will, your spouse or remaining family members may have little choice in the administration of your estate, regardless of what your wishes were.
- Living Trust: A Living Trust is a supplement to a Will and acts as a method for probate and court avoidance once someone passes away. Not every person needs or wants a Trust, but for many people, a Trust is an appropriate way to provide privacy and ensure their wishes are followed. A Trust can provide special directions for how property should be distributed in the case that there are minor beneficiaries. For example, both parents pass away leaving three children under age 18. A Living Trust can direct for individual trusts to be created for each child to provide for their support, health, education, and maintenance. Then, once the children reach a certain age (commonly 21 or 25), the remaining property is distributed to them in full. For families with significant monetary or real property assets, a Living Trust is recommended.
- Updated Deed: For people who own real property, it is important to review the current property ownership (the deed) to make sure that the ownership reflects the current newlywed status. For example, a person owns a home prior to getting married and that home is where the newlywed couple will live after marriage. The deed to that property only reflects one person owning the property. Upon marriage, it is recommended for the deed to be updated to reflect both spouses as owners. In North Carolina, it is also recommended to add “tenants by the entirety” to the deed. This classification protects the spouses from each spouse’s individual creditors. Also, if you are opting for a Living Trust, a deed can be prepared that will list the trust as the owner of the property which provides another safeguard for probate avoidance.
Preparing and planning for the future is not something that should be postponed or ignored, especially for newly married couples just starting their lives together. Once you’ve said “I do” to each other, you should make the last few changes necessary to begin your life as a married couple. The attorneys at Hopler, Wilms, & Hanna, PLLC, regularly assist newly married couples with estate planning and ensuring that all affairs are in order for the future.
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