Florida Estate Planning for Second Marriages

Serving Palm Peach, Martin, St. Lucie, Broward, Okeechobee Counties, and the Surrounding Communities

People who plan to remarry or who already are in a second marriage can face complex estate planning challenges. The individuals usually bring their own assets into the marriage. They may also have children from prior marriages whose inheritances they wish to protect. Sometimes the homestead property that one spouse owns is the marital home, presenting another potential complication.

What is my spouse entitled to inherit from me?

Many “blended families” truly blend, but tension between adult stepchildren and a parent’s new spouse is common. Without good planning, the tensions worsen or emerge for the first time following the death of a parent. Those tensions can even become lawsuits. If you are like most people, you probably want to promote family harmony, protect your children, and provide for your spouse if you are the first to die. Many of the planning techniques that work well in first marriages are inappropriate for remarriages. Our estate planning attorneys are experienced in helping couples in this situation. Please contact us for an appointment.

Some questions that must be considered by people who are remarrying include:

What is my spouse entitled to if he/she outlives me?

In Florida, the spouse is entitled to an elective share of a deceased spouse’s estate. The elective share is 30% of the deceased spouse’s assets. Additionally, the surviving spouse has the right to either continue to reside in the homestead property for the rest of his/her life, or to force the sale of the homestead and collect one-half of the sale proceeds.

Are assets I put in my own individual trust considered when determining elective share?

Yes. The elective share is based on 30% of the augmented estate. Your trust assets are part of the elective share. So are jointly owned assets and beneficiary-designated accounts.

Can’t I just leave everything to my spouse, who I trust implicitly and who has promised to pass on whatever remains to my own children?

No. This and other techniques suitable for first marriages are often inappropriate for second marriages. We do not recommend leaving your estate outright to your spouse without any conditions as this cannot guarantee your assets will be distributed as you wish. Once your spouse inherits your assets, he/she is under no legal obligation to leave anything to your children. Even if your spouse truly intends to pass on your assets to your children, circumstances beyond his/her control may arise that prevent that from happening. For example, consider these scenarios:

After you are gone, your spouse becomes mentally disabled and makes poor financial decisions, squandering the assets. Or your spouse’s children may be able to convince their parent to make them the sole beneficiary of the assets and to cut out your children. If your spouse’s children have a durable power of attorney for the parent, they then use their authority to take control of the assets, possibly diverting the assets to themselves.
One of your spouse’s children experiences financial difficulties. Being human, your spouse finds it difficult to say no, and gives his/her child some or all of the assets that were supposed to end up with your children.
If you become disabled, your spouse may end up being your caregiver for months, possibly even years. Following your passing, your spouse’s children may convince your spouse that keeping your assets is rightful payback for all that care.
Your spouse may remarry, changing the dynamic entirely.

My spouse has a will that earmarks certain assets for my children. Isn’t that sufficient?

No, because a will can be changed at any time, so long as the will-maker is competent. There would be nothing to prevent your spouse from changing the will and naming as beneficiary his/her own children, or even a new spouse. Moreover, a will has no control over what your spouse can do during his/her lifetime with the assets that have been inherited from you.

What are the possible solutions?

Enter into a pre-nuptial agreement, or if you’ve already married, a post-nuptial agreement in which both of you waive your right to an elective share and/or homestead rights.
If you have a 401k you want your children to inherit, your spouse will need not only to sign a pre- or post-nuptial agreement, but also sign a waiver of his/her rights on the 401K beneficiary form.
Create a trust. When you pass away, your assets are held in trust for your spouse. Your spouse can draw on the income. If you wish, you can also include provisions that allow your spouse to access the principal for certain purposes. Anything that remains in the trust upon your spouse’s death then passes to your own children.
Depending on your financial condition and your health, consider purchasing life insurance on your life, naming as beneficiary your spouse and/or your children from your first marriage, and leaving some of the proceeds to each. Another possibility if you purchase life insurance is to set up a trust for the insurance that will distribute a specific amount that you choose to your spouse for the balance of his/her life, with the remainder going to your children upon his/her death.

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I was introduced to Karp Law in a referral from the Senior Council of Martin County in 2012. I could not ask for a more knowledgeable firm to handle my and my husband’s affairs. They were and are hands on, keeping us in the loop of areas that might affect us and guiding me in each step that was necessary as a wife and widow.

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