How to Manage Financial Matters Before Getting Married Late in Life
You need to discuss issues such as estate planning and Social Security benefits before you become older newlyweds.
BY: Stacy Rapacon
September 11, 2017
LIKE MANY COUPLES, Gertrude Mokotoff and Alvin Mann met at the gym. Like far fewer couples, after eight years of dating, they got married – at ages 98 and 94, respectively. And their love story for the ages went viral.
Making such a commitment that late in life may not be all that common, but people are often waiting longer to get married these days. In 1956, when entering their first marriages, women were just 20.1 years old and men were only 22.5 years old, on average, according to the U.S. Census Bureau. In 2016, those average ages moved up to a ripe 27.4 and 29.5, respectively.
Those additional years of being single are affording people more time to build up their financial lives as individuals, which may complicate money matters when it comes time to get married. And of course, when you’re entering a second or third marriage, like the newly married Manns, you’re likely to have a more complex financial picture than a standard singleton.
“Getting married later in life is certainly rife with potential financial issues,” says Natalie Colley, an analyst at financial planning firm Francis Financial in New York City. “There are a lot of financial implications that you need to consider in your mid-30s, 40s, 50s and later that you maybe wouldn’t have had to consider if you were getting married in your early or mid-20s.”
For one thing, she notes, you may have accumulated more assets once you’re further into adulthood. You also are likely to be earning a greater income than when you were first starting out.
Along with having more money to worry about, you have less time on your side. “It is very important for people to think about their financial situations before getting married later in life because they typically don’t have the time to make up for financial mistakes,” says Annika Cushnie, a partner and certified financial planner at wealth management firm Brightworth in Atlanta, in an email. Especially for people who are already retired, “they don’t typically have the earnings capability … to rebuild their portfolio.”
On top of the quantitative issues, you and your future spouse have your money personalities and habits to consider. “The older you get, the more stuck in your ways you get,” says certified financial planner Taylor Schulte, founder of Define Financial in San Diego. “It’s really hard to change and adapt to absorb someone else’s philosophies and ideas.”
All that makes it even more imperative that you and your partner have a detailed discussion about finances. “Sit down around the table, carve out some time and be open and transparent about what your financial situation looks like,” Schulte says. “Not just your past and your current situation, but also your future.”
You might want to physically write out your discussion points – and even consider creating a prenuptial agreement. “The later in life you get, the more important the prenup becomes,” Colley says. You can use it to protect the greater amount of assets you’re likely to have, as well as establish who’s responsible for certain debts. For example, if one spouse has a mortgage coming into the marriage, you may want to outline what portion of that debt, if any, the other spouse would be on the hook for.
A prenup can also help firm up financial expectations you might have of one another, such as whether one person would help support the other person’s children or other family members. “It’s a document you can use to get on the same page,” Colley says. “[You can] establish things that maybe can’t be forcible by law, but you just want to have it down in the contract.”
The subject of children can be particularly complex when it comes to a late-in-life marriage. If kids from a former relationship are college-aged, you need to review how your incomes and assets may affect their potential financial aid. You also have to discuss your plans on how to pay for school. “These are all things that I think should be talked about and addressed early,” Schulte says. “Don’t wait until the kid’s gearing up to leave for college, and now you guys are arguing about the expense.”
The situation with adult children can be just as important to consider before getting married, especially when it comes to your estate plan and beneficiary designations. You may want to review with your kids and potential new spouse what you already have in place and decide how, and if, you want to make any adjustments. “Estate planning with second or third marriages can create situations that are complex and emotional, especially if there are adult children from previous marriages and a large age gap between the new spouses,” Cushnie says.
If your current financial situation depends on the estate plan of a former spouse, consider how getting remarried can affect you. “In some cases, distributions from trusts or other rights set forth under the deceased spouse’s will can stop if the surviving spouse remarries, which could have a big impact on his or her financial stability,” she says.
The same goes for Social Security benefits. If you’re a widow, you may qualify for survivor benefits, but you can lose them if you remarry before age 60. And if you’re divorced, after being married for at least 10 years, you can collect Social Security starting at age 62 based on your former spouse’s work record. But again, getting remarried would disqualify you from those benefits. (If that next marriage were to end, you could resume collecting them.) If you receive alimony or child support from a former spouse, you stand to lose some of those payments as well.
These situations can change your financial picture drastically and may give you pause before jumping into marriage. They may not stop you from saying your vows, but they are important points to consider and discuss when making your financial plan. “Marriage is such a precious thing to me,” Schulte says. “It’s not something that I would change or sacrifice for a financial reason, but again, it’s all about communication.”
And if you’re lucky enough to find a second or third shot at love like Mokotoff and Mann as nonagenarians (or even decades younger), don’t be afraid to spend some money.
“All these financial things are really important, but once you have a plan in place, go have a little fun and enjoy the time you have left together,” Schulte says.