Newlywed Estate Planning Checklist

 Posted on September 17,2015 in Estate Planning

One of the last factors that most newlyweds consider—yet perhaps one of the most important—is making estate planning arrangements. This is especially true for younger married couples.

There are steps a newly married couple should take to ensure that if one spouse is affected by a tragedy, the other spouse will be cared for.

Newlywed Estate Planning Tips

First, a couple should contact their employers' Human Resources departments. There are often benefits and/or retirement accounts which will need to be updated with new beneficiary information. For example, one spouse may have had one or both of his or her parents as the beneficiary of an employment life insurance policy. If the beneficiary information is not changed and something happens to that spouse, the surviving spouse would not receive any of that life insurance policy's payout—the funds would go to the parents of the spouse.

Additionally, the beneficiary on retirement accounts should be changed. Although the majority of employment retirement accounts are overseen by the Employee Retirement Income Security Act (ERISA), which states that assets from a retirement account go to a spouse unless there is specific written consent otherwise, changing the beneficiary upon marriage will ensure that there are no issues or delays in those benefits being released to a surviving spouse.

When it comes to life insurance, a couple may decide that they need more than they currently each have, especially if they are going to purchase a home and/or have children. Most life insurance plans have premiums which are based on a person's age. Therefore, if a couple purchases a policy while they are young, the policy may be less expensive.

Getting married is also a good time to execute a will—or update an existing one. A will ensures that if something should happen to one spouse, the other spouse will receive all the assets of the marriage. In Illinois, if a person dies without a will, there are several scenarios that may play out regarding how his or her assets will be divided, and the result may not be what the wishes of the person who has died would be. If a couple has a prenuptial agreement, their wills should also reflect their asset division requests.

Finally, when meeting with an attorney to draft wills, a couple should discuss drawing up health care advance directives and durable power of attorneys. All of these issues can be addressed by contacting an experienced DuPage County estate planning attorney.

Sources:

http://www.dol.gov/dol/topic/health-plans/erisa.htm

http://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2104&ChapterID=60