If you have children from a first marriage, entering into a second or third marriage has implications for their ability to inherit your estate. If you die without a will in Minnesota, your spouse will receive the first $225,000 in assets from your estate plus half the remaining assets, while your children receive the other half. This scenario is further complicated if you and your new spouse also have children together.
These smart estate planning strategies can help ensure that you provide for your children as well as your new partner.
Update your beneficiaries
Many types of assets automatically go to the named beneficiary upon the account holder’s death regardless of what the will says. This includes life insurance policies, retirement accounts, and payable-on-death bank and investment accounts. When you remarry after divorce, these assets do not list your former spouse as the beneficiary. Update the asset to go to your new spouse or your children depending on your wishes.
Create a will
When you have family heirlooms or other property that you want to leave to your children, make sure you establish a will that clearly indicates who should receive what upon your death. Without a will, you have no guarantee that your children will receive valuable or sentimental items in accordance with your wishes.
Establish a trust
If you own assets with your spouse and want a portion of those assets to go to your children, you can transfer that portion into a trust. The trust document spells out your wishes for when and how the beneficiary will inherit those assets. Without a trust in place, your surviving spouse will decide the fate of the assets in his or her will.
The older you are when you marry for a second or subsequent time, the more likely you are to own significant assets. Have a conversation with your partner so he or she is not surprised by your estate plans.