Found this article interesting. Advantages to divorcing in your golden years.
https://www.marketwatch.com/story/the-crushing-financial-pen…
Advantages to divorcing in your golden years.
Yep. One that they didn’t mention is that if you’ve been married for more than 10 years and you divorce, claiming benefits on your spouse’s record is more flexible than if you’re still married.
AJ
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I am struggling a little bit with this. I am an early retiree (59) with a small nest egg. I have enough to live a happy simple life, without much excess. I have no debt. I paid cash for my house and car and pay off credit cards every month. I have no children.
I am engaged to a kind, caring man who spent many years helping me to care for my father. My fiance (55) is on disability due to brain surgery that affected his speech and short term memory. Thanks to his long term disability insurance he is on Medicare, not Medicaid. His brain medications are very expensive. He has little money to contribute to the household. He has a car loan (for an inexpensive, safe, common sense sedan). He has PLUS loans for his children’s college educations and credit card debt that he is slowly paying down. He paid spousal support and child support for many years. The amount he paid in support was based off his professional salary, not his reduced long term disability income. I respect the sacrifices he made to support his children. His ex-wife divorced him when she realized she could not handle his medical issues.
He moved in with me in October so I could care for him after foot surgery. He buys most of our groceries, gives me a little money each month and continues to pay down his debt.
I realize that we will be jointly responsible for his debt once we marry.
My biggest concern is my own future long term care. My personal plan was to eventually move into a nice continuous care retirement community before becoming my own worst enemy. I am assuming we should now plan to move into a continuous care community together. Covid is causing me to rethink this plan. I know of two couples who lived in the same CCRC but could not visit with each other during Covid because one was in memory care or assisted living and the other was still in the independent living section.
My biggest future fear is to spend down all of my nest egg to care for my husband and have no resources (and no children to help me) when I need care. If we don’t marry, he would be eligible for Medicaid.
Are there other options to preserve financial resources for the longer-living spouse besides moving into a continuous care community together?
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Reply to holhealthprac: I think you can possibly pre-nup against having to pay his debts. But in all honesty, it sounds like you’d be better off financially in a domestic partner relationship (meaning “don’t get married”). In fact, to be more blunt, it sounds like getting married is taking a huge financial risk. I can’t see what getting married adds, other than some traditional psychological value. But I can see a lot of potential financial harm that can come from getting married. I don’t think you can pre-nup out of long-term-care (“nursing home”) expenses. I’m happy you two found each other but taking on his financial risk doesn’t seem prudent, based on what you posted.
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I would be wary of the pre-nup option. Depending on state law, it may not matter much. Consult a lawyer for that bit.
But I agree that -from the info provided-, don’t get married. You would be taking on (apparently) a worse financial situation than yours. If his situation deteriorates, he would be eligible for further aid. If your finances get into the mix, you would have to drain your resources before he would be eligible if you were married. (I know this because a lady on another board has a severely disabled husband, and they aren’t eligible for assistance until they are destitute.)
I am not a pro, and you should consult a lawyer for the laws in your state, and maybe a financial advisor. But my gut says “don’t do it”, and follow through with your original plan. Talk to the community you’re interested in, and ask them about their policies (don’t just assume all CCRC policies are the same).
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1poorguy wrote: “I would be wary of the pre-nup option. Depending on state law, it may not matter much. Consult a lawyer for that bit.”
While I was the one who warned the poster about the financial risk of getting married, I do not understand your comment, quoted above. Rich people get married to other rich people and to non-rich people all the time using prenups. Why do you say “it may not matter much”? Prenups are a proven financial tool, if properly implemented, to protect wealth. Can you cite otherwise?
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Because a pre-nup does not protect against third parties like the government. Medicaid is not bound by a pre-nup agreement between husband and wife.
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But 1poorguy was referencing some STATE law that he thinks makes prenups invalid. We already stipulated to the fact that you can’t prenup out of nursing home costs. That couldn’t be what he was referring to.
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Daryll44: “Some STATE law that he thinks makes prenups invalid”
See, e.g., Texas Family Code, which does not necessarily invalidate a prenup, but which takes away some of the protection that a prenup might otherwise provide.
"TEXAS FAMILY CODE:
SUBCHAPTER C. MARITAL PROPERTY LIABILITIES
Sec. 3.201. SPOUSAL LIABILITY.
(a) A person is personally liable for the acts of the person’s spouse only if:
(1) the spouse acts as an agent for the person; or
(2) the spouse incurs a debt for necessaries as provided by Subchapter F, Chapter 2.
(b) Except as provided by this subchapter, community property is not subject to a liability that arises from an act of a spouse.
(c) A spouse does not act as an agent for the other spouse solely because of the marriage relationship.
SUBCHAPTER F. RIGHTS AND DUTIES OF SPOUSES
Sec. 2.501. DUTY TO SUPPORT.
(a) Each spouse has the duty to support the other spouse.
(b) A spouse who fails to discharge the duty of support is liable to any person who provides necessaries to the spouse to whom support is owed."
I think that the OP should stay engaged (perhaps until death do her part from her beloved) and never marry [and avoid common law marriage if that doctrine still exists in her jurisdiction {not every state recognizes common law marriage}].
If OP wants similar rights to marriage then she needs to research the documents that gay or lesbian couples used prior to Obergefell.
Just my $0.02 and definitely NOT LEGL ADVICE.
Regards, JAFO
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JAFO wrote: “See, e.g., Texas Family Code, which does not necessarily invalidate a prenup, but which takes away some of the protection that a prenup might otherwise provide.”
Agreed. And as per my first post on this matter, I acknowledged that getting married incurs some risk, even with a prenup. My overall point, however, was that 1poorguy pretty much dismissed prenups as fairly worthless. My observation is that they seem to work well, generally, overall, and are a valid tool for financial planning, even if they aren’t 100% perfect.
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Why do you say “it may not matter much”? Prenups are a proven financial tool, if properly implemented, to protect wealth. Can you cite otherwise?
Pre-nups may not override state Medicaid laws that require that nearly all assets belonging to a couple be spent down before either of them is eligible for Medicaid.
My advice to the OP would be to see an estate planning attorney in their state BEFORE getting married and/or deciding to move into continuing care. Depending on the laws in their state, there may be ways to protect assets, which may, or may not, involve a pre-nup. But it’s all dependent on the Medicaid laws in their state.
AJ
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But 1poorguy was referencing some STATE law that he thinks makes prenups invalid.
Each state sets their own Medicaid laws that are at least as strict, but can be more strict, than the Federal laws.
We already stipulated to the fact that you can’t prenup out of nursing home costs. That couldn’t be what he was referring to.
Since Medicaid was mentioned in the original post, I’m not sure that just saying you can’t pre-nup out of nursing home costs is much of a defense for saying that a pre-nup would be useful. There are ways that assets can be protected from Medicaid, but state requirements on how to do that vary. Before getting married, or even executing a pre-nup, the OP should be consulting an estate planning attorney specializing in elder-care.
AJ
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My biggest future fear is to spend down all of my nest egg to care for my husband and have no resources (and no children to help me) when I need care. If we don’t marry, he would be eligible for Medicaid.
Are there other options to preserve financial resources for the longer-living spouse besides moving into a continuous care community together?
Even moving into a continuing care community may not preserve your assets like you think it will. You need to consult an estate planning attorney specializing in elder care NOW.
I say this because the act of living together for a specific period of time may constitute common law marriage, even if you don’t have a ceremony. Since you have been living together for almost a year, you may be coming up on that time limit, so even if you don’t get married officially, your state may consider you married, and require you to spend down your assets caring for him.
There are state-specific ways to protect your assets from being spent to care for a spouse, which is why you need to consult an attorney.
AJ
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Daryll44:
JAFO wrote: <<<“See, e.g., Texas Family Code, which does not necessarily invalidate a prenup, but which takes away some of the protection that a prenup might otherwise provide.”>>>
“Agreed. And as per my first post on this matter, I acknowledged that getting married incurs some risk, even with a prenup. My overall point, however, was that 1poorguy pretty much dismissed prenups as fairly worthless.”
“Necessities” is a way broader exception than " cannot prenup out of nursing home costs" and Medicaid that others have referenced.
“My observation is that they seem to work well, generally, overall, and are a valid tool for financial planning, even if they aren’t 100% perfect.”
I agree that prenups can be a tool for financial planning. How well they work depends upon, among things, the size of the assets you are trying to protect, assuming that the prenup is valid.
Any contract requires:
-
Real Agreement - An offer and acceptance
-
Consideration — Both parties must give something or promise to refrain from doing something they have a right to do
-
Capacity — Both parties must have the legal capacity to enter into the agreement
-
Volition — The parties must voluntarily agree to the terms of the contract (no adhesion, no spring it on the morning of the wedding)
-
Legality — The subject matter must be legal (for example, IIRC, a spouse cannot prenup child support away because that is for the benefit of the child(ren)
A prenup, for example, must involve a true and accurate disclosure of assets and liabilities so that each spouse knows what he/she is forgoing.
A prenup probably also needs to in writing; though in some particular state a verbal prenup may be valid (but I doubt it)
It may well be that each spouse needs to be represented by his or her own counsel.
And, the prenup probably needs to be conscionable; if it too unfair to one spouse, a court may set it aside
If someone is considering a prenup they need counsel well versed in prenups because by the time a mistake is likely to be discovered it will be too late to fix it because the parties have probably started on the road to split up / divorce (much like DIY estate planning problems often only come to light after the testator has died)
Regards, JAFO
(he double hockey sticks, if I wanted a prenup I believe that it should be discussed prior to any engagement just to be safe; an offer to marry without notice of a prenup is clearly a change in terms (or addition of a condition that was not present when the offer was made))
NONE OF THIS IS LEGAL ADVICE; CONSULT AN ATTORNEY YOU HIRE IF YOU NEED LEGAL ADVICE
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I think you can possibly pre-nup against having to pay his debts. But in all honesty, it sounds like you’d be better off financially in a domestic partner relationship (meaning “don’t get married”). In fact, to be more blunt, it sounds like getting married is taking a huge financial risk. I can’t see what getting married adds, other than some traditional psychological value. But I can see a lot of potential financial harm that can come from getting married. I don’t think you can pre-nup out of long-term-care (“nursing home”) expenses. I’m happy you two found each other but taking on his financial risk doesn’t seem prudent, based on what you posted.
Daryll44:
I value and appreciate your blunt, honest opinion. I am planning to meet with an attorney about estate planning and elder care issues.
HHP
I would be wary of the pre-nup option. Depending on state law, it may not matter much. Consult a lawyer for that bit.
But I agree that -from the info provided-, don’t get married. You would be taking on (apparently) a worse financial situation than yours. If his situation deteriorates, he would be eligible for further aid. If your finances get into the mix, you would have to drain your resources before he would be eligible if you were married. (I know this because a lady on another board has a severely disabled husband, and they aren’t eligible for assistance until they are destitute.)
I am not a pro, and you should consult a lawyer for the laws in your state, and maybe a financial advisor. But my gut says “don’t do it”, and follow through with your original plan. Talk to the community you’re interested in, and ask them about their policies (don’t just assume all CCRC policies are the same).
ipoorguy:
I appreciate your original post because it is the main reason I don’t feel good about moving ahead with wedding plans. My gut keeps telling me to “put it off and think about it later”.
I haven’t chosen a CCRC yet. I am just turning 60 this year, so things may change quite a bit between now and the time I need one. Hopefully it will be a long time. Learning as much as I can about today’s rules would probably be helpful.
I will consult an attorney regarding estate planning and elder care law.
Thanks for your reply,
HHP
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Because a pre-nup does not protect against third parties like the government. Medicaid is not bound by a pre-nup agreement between husband and wife.
Thanks Rayvt. That is my uneducated understanding also. HHP
I think that the OP should stay engaged (perhaps until death do her part from her beloved) and never marry [and avoid common law marriage if that doctrine still exists in her jurisdiction {not every state recognizes common law marriage}].
If OP wants similar rights to marriage then she needs to research the documents that gay or lesbian couples used prior to Obergefell.
Just my $0.02 and definitely NOT LEGL ADVICE.
Thanks JAFO. I appreciate your $0.02. The attorney who drafted my will happens to be a member of the LGBTQ+ community. She is probably well versed in these laws.
Thanks for mentioning the common law marriage implications. I hadn’t thought about that.
HHP
Pre-nups may not override state Medicaid laws that require that nearly all assets belonging to a couple be spent down before either of them is eligible for Medicaid.
My advice to the OP would be to see an estate planning attorney in their state BEFORE getting married and/or deciding to move into continuing care. Depending on the laws in their state, there may be ways to protect assets, which may, or may not, involve a pre-nup. But it’s all dependent on the Medicaid laws in their state.
Thanks AJ,
I had forgotten that Medicaid laws vary state by state. I will make an appointment to see my attorney.
HHP
Even moving into a continuing care community may not preserve your assets like you think it will. You need to consult an estate planning attorney specializing in elder care NOW.
I say this because the act of living together for a specific period of time may constitute common law marriage, even if you don’t have a ceremony. Since you have been living together for almost a year, you may be coming up on that time limit, so even if you don’t get married officially, your state may consider you married, and require you to spend down your assets caring for him.
There are state-specific ways to protect your assets from being spent to care for a spouse, which is why you need to consult an attorney.
Thanks AJ. I will call my attorney for an appointment, especially given your comment that asset protection is state-specific.