Marriage at any age involves compromise. When people marry later in life, however, the financial and estate planning questions can be very different from those facing a couple just starting out.

Who pays for the bucket-list trips? Whose name should be on the home the couple will share? What happens to property that each person accumulated before the marriage? And how should each spouse balance providing for a new husband or wife with leaving an inheritance to children from a prior relationship?

That does not mean remarriage needs to make estate planning complicated. It does mean that both partners should understand what they own, what rights marriage may create, and whether their existing documents and beneficiary designations still accomplish what they intend.

Start With the Home

For many couples, the home is one of the most important assets to discuss. One spouse may already own a house when the couple marries, or the couple may purchase a new home together. How title is held can have important consequences at death.

A common concern arises when one spouse owns the home and wants a surviving spouse to be able to continue living there, but ultimately wants the property to pass to children from a prior marriage. Simply assuming that everyone will work things out later can create uncertainty for both the surviving spouse and the children.

Michigan law gives a surviving spouse certain rights in a deceased spouse's probate estate, but those rights are not a substitute for deliberately planning how a particular home should be handled. Depending on the couple's goals, the solution might involve the form of ownership, a trust, a right to occupy the property, or another estate-planning arrangement.

Children From Prior Relationships Add Another Layer

Remarriage frequently creates a blended family. Each spouse may want to provide financial security for the other while also making certain that some or all of his or her property eventually passes to children.

Those objectives can conflict if they are not addressed in advance. Leaving everything outright to a surviving spouse, for example, gives that spouse control over what ultimately happens to the property. On the other hand, leaving everything immediately to children may leave the surviving spouse without adequate resources.

A trust can sometimes provide a middle ground. Property can be available for a surviving spouse during his or her lifetime while identifying who will receive what remains after the surviving spouse dies. The appropriate arrangement depends on the couple's assets, family relationships, and goals.

Four Issues to Review Before Remarrying

Prenuptial Agreements Can Be Part of the Estate Plan

A prenuptial agreement is not only about what happens in a divorce. For people marrying later in life, it can also be an estate-planning tool.

Discussing a prenuptial agreement requires each partner to identify assets and expectations before the wedding. If both partners have children from previous relationships, for example, they can discuss how much each intends to provide for the new spouse and how much should ultimately remain for their respective children.

Those conversations may not be romantic, but discovering different expectations before marriage is generally preferable to leaving a surviving spouse and stepchildren to sort them out after a death.

Life Insurance Can Help Balance Competing Goals

Life insurance can sometimes provide another source of funds for a surviving spouse or children. For example, one asset might ultimately be intended for children while insurance provides additional financial support for the surviving spouse.

The right approach depends on the couple's circumstances, including existing insurance, insurability, premiums, retirement resources, and the needs of both spouses.

Long-Term Care Should Be Part of the Conversation

Long-term care is another important consideration for couples marrying later in life. Medicare generally does not pay for ongoing custodial nursing-home care, and the cost of long-term care can significantly affect a couple's finances.

Medicaid planning may be available in appropriate circumstances, but it should not be reduced to simply transferring assets into a trust. Michigan Medicaid has detailed rules concerning assets, transfers, trusts, and transfers made during the applicable lookback period.

Review Retirement Accounts and Benefits Before the Wedding

Retirement accounts deserve particular attention. Certain employer-sponsored retirement plans provide rights to a spouse, and naming someone other than a spouse as beneficiary may require the spouse's written consent. The rules depend on the type of retirement plan involved.

Remarriage can also affect some Social Security benefits. For example, remarriage may affect benefits being received on a former spouse's record, while different rules apply to survivor benefits depending in part on the age at which a person remarries. Other benefits, pensions, or support arrangements may have their own rules.

For that reason, someone receiving benefits based on a prior marriage should determine the financial effect of remarriage before the wedding rather than discovering it afterward.

A Practical Remarriage Estate-Planning Checklist

The Goal Is a Plan Both Spouses Understand

Estate planning for a later-in-life marriage does not have to be adversarial. In many cases, the most valuable part of the process is simply identifying assumptions that neither partner had previously discussed.

A good plan can provide for a surviving spouse, preserve an intended inheritance for children, address incapacity, and make clear how important assets should be handled. The particular solution should fit the couple rather than forcing every blended family into the same arrangement.