By The ABC series The Golden Bachelor has captivated audiences with its message that it’s never too late for love and remarriage. While the show focuses on the chemistry between couples, it’s important to give equal attention to financial concerns when walking down the aisle for the second time.
In a recent episode, the reality series culminated with the televised marriage of bachelor Gerry Turner, 72, and his 70-year-old fiancée, Theresa Nist. They triumphed over 21 other contestants aged 60 and older to find love later in life. For those planning to tie the knot again, here are some crucial considerations to keep in mind.
Sharing Financial Perspectives
According to Renée Hanson, an Ameriprise private wealth advisor with Affinity Wealth Advisory Group in Phoenix, it’s vital to discuss your complete financial picture and attitudes towards money with your partner. Start conversations about money by asking questions like, “What experiences have shaped your financial decisions? What do you consider your best or worst financial decision? How do you envision managing our finances together?”
Honesty About Debt
Transparency is key when discussing financial matters. Be upfront about any existing debt you owe. Generally, debts acquired before the marriage do not become shared liabilities. However, there are exceptions, and this information plays an important role in understanding your overall financial situation.
Prenuptial Agreements: Protecting Your Interests
Consider creating a prenuptial agreement, a contract that outlines how both spouses will safeguard their interests in the event of divorce or death. John Lambros, managing partner of law firm Brinkley Morgan in Fort Lauderdale, Fla., emphasizes the importance of consistency between a premarital agreement and estate planning. While an estate plan details how assets will pass upon death, a prenuptial agreement focuses on protecting individuals during a marriage.
Separating Assets, Combining Cash Flow
Many couples who remarry choose to keep their assets separate but combine their cash flow. A prenuptial agreement can establish guidelines for splitting bills, such as a 50/50 or 70/30 split based on income. While these agreements serve as aspirational guidelines, it can be challenging to enforce them while the marriage is intact.
In conclusion, while love may be the beating heart of a remarriage, financial considerations are equally important. By openly discussing financial matters, considering a prenuptial agreement, and finding a balance between individual assets and shared cash flow, couples can navigate the financial aspects of remarriage with confidence and clarity.
Taxes & Social Security
Married couples generally get the most financial benefit if they file taxes jointly. However, there are circumstances that may warrant filing separately. One example is if a spouse has certain debts, such as money owed to the Internal Revenue Service or defaulted government student loans. In such cases, wages or tax refunds can be seized by the government to cover them, which could become a shared liability if you file jointly.
Another scenario where filing separately might make sense is if one spouse has considerable medical bills. The IRS allows taxpayers who itemize their deductions to deduct unreimbursed medical expenses that exceed 7.5% of their adjusted gross income. Filing separately provides a lower threshold to clear before you can itemize. For married filing separately, the standard deduction is the same as for single people, which is $14,600 in 2024 compared to $29,200 for married filing jointly.
However, it’s important to weigh these benefits against the disadvantages of married filing separately. One drawback is a lower threshold for higher Medicare premiums. Married couples filing jointly have six income tiers for their Medicare premiums, while married couples filing separately have only three. For separate filers, the monthly Part B premium jumps from the standard $174.70 to $559 for incomes over $103,000.
When it comes to alimony, it typically ends with remarriage. However, those receiving support from an ex-spouse could try to negotiate a smaller, lump-sum payout instead of continued regular support if they’re planning to get remarried.
Remarriage can also have an impact on your Social Security benefits. If you were married for at least 10 years, you can collect benefits on an ex-spouse’s benefit record. However, these benefits generally stop if you remarry.
For widowed individuals, there’s an additional consideration. If you remarry before age 60, you aren’t entitled to survivor benefits on your deceased spouse’s earnings record. Since survivor benefits are often higher than spousal benefits, eligibility for them could be a factor in timing the marriage.
Comments