Late-Life Marriage and What it Entails

In this episode, John Ross and Lisa Shoalmire discuss issues revolving around late-life marriages and a few things to consider before tying the knot.

Episode Transcript
Lisa
Welcome to Aging Insight. I'm Lisa Shoalmire and this is John Ross, and this is a program that we bring to you weekly so that we can answer your questions about aging and retiring, and enjoying that time, and making sure that you have the information that you need so that you don't go broke during this time, that you don't become a burden on your family and that you can remain as independent and living the life as you choose to do so for absolutely as long as possible. And that's why we come to you every week.
John
Yeah, I read a quote, this is not the exact quote, but I read something that's from one of the celebrities and I think it was a woman and she said, "Aging is not for sissies." And the problem is, is it's not that aging is a problem, it's that there's so many pitfalls. And sometimes even joyous occasions, sometimes even happy moments have little hidden consequences back in there, that if you're not aware of them and you don't plan for them, can come back and get you.
Lisa
Yeah. And so that kind of brought us to today's topic. We live in a community where we're all humans, we enjoy the companionship and fellowship of our friends, and neighbors, and family, and loved ones. And a lot of times, we have couples that we've known have been together forever, and then one of them dies. And I hear so often, in that situation, I hear the survivor say, "You know what? I'm just never gonna get remarried. It was a wonderful marriage. I'm never gonna get remarried." And then, a year or two later, I run into 'em and they have recently remarried, often to usually someone they've known, or whatnot. But they know that they've missed the companionship of sharing this life with someone. And it's a great thing, happy thing, a joyous thing. But late-life marriages bring their own sets of complications. And so today, we wanna talk about some of those complications that you need to think about and look at, maybe before you take that step or certainly if you're in a marriage later in your life that you wanna get some things in order, so you don't run into problems later.
John
And oftentimes, when people think about late-life marriages and they think about potential problems that might come up with them, a lot of times what they think about is related to the kids. But before we ever get to dealing with those kids, there's still a lot of life there and there's a lot of life for this newlywed couple, even if newlywed is two folks in their 90s. This newlywed couple still needs to be aware of how this marriage is going to impact them financially. Because when you get married, things change. When you're a single person, it's pretty clear to figure out who owns what. Well, you own your stuff, 'cause you're single. That's easy. When you're married, though, what's his and what's hers, and what's theirs, all of those things start getting blurry. And I will tell you, one thing I've had a lot of folks come in and they'll say, "Well, John, we're needing to put together some estate planning, or maybe we're concerned about long-term care cost, and we're in a second marriage, and I've got kids and he's got kids. But you know what? We've taken care of all of this, because he has his bank account, I have my bank account, and he has his real estate, and I have my real estate. And so, we don't need to worry about anything. We've got it all separate." Well, you might have it separate in your mind, but that doesn't have anything to do with what the law says about your assets and how these things have gotten combined, now that you've gotten married.
Lisa
Well, that's right. And this is a situation where a lot of folks going into a late-life marriage because they are maybe more financially secure, they may have pensions and retirements that they have built up over their working years, or maybe even they're receiving a survivor benefit from their now deceased spouse. But the law looks at any marriage, whether you're 25 or 85, as a combining of an economic force, a combining of property, a development of joint income, in many cases. So, that's something to look at. A lot of seniors that go into a second marriage, many of them do choose to come and visit about a prenuptial agreement, in order to line out what you came into the marriage with and how you wanna treat those assets during the marriage. But that's not the end. That's not the complete solution. [chuckle]
John
Right, and I will say that a premarital agreement, especially in second marriages and late-life marriages, some people find them, the whole idea of a prenup distasteful because they're thinking of it in terms of divorce. Well, yeah, divorce is an element, but that's not really the main thing. Again, you've had a long life and over that life you may have acquired some assets, but you may have also acquired some liabilities. There could be debts and things like that that are out there. When you become incapacitated or when you die, how assets pass and things like that, all of those sort of things can be addressed prior to ever getting married. And so, figuring out whose is what, and who's gonna stay separate property, and what's gonna be marital property or community property, figuring some of those things out ahead of time, not in the context of what happens if you get divorced, but more in the context of, "Who's gonna be responsible for debts that were occurred?" Or, "Who gets to make decisions regarding your property when you can't make those decisions for yourself?" Some of things can be very important in that premarital agreement, regardless of whether or not you ever get divorced. So that's the first thing, but like Lisa said, it's not the be all, end all, because there is a bunch of other problems, especially when it relates to long-term care.
Lisa
So we're gonna take a break, and then we're gonna come back and talk about what a late-life marriage and the impact of combining households can have on your access to long-term care.
John
Hi, I'm John Ross, elder law attorney and board member for the Alzheimer's Alliance, and welcome to Our Place. Our Place is a day program designed to provide rest and relief for the caregivers of people with Alzheimer's and related dementias. Our Place is a safe environment where our friends benefit from socialization in a home-like environment. Alzheimer's is devastating, and affects over 17,000 families in our area. To find out how Our Place can benefit you, please visit our website.
John
Welcome back to Aging Insight, and today we're talking about second marriages. And while we want this to be a happy time for you and we want you to have companionship, we also want you to think about a few things as it relates to some of the hidden issues with these second or late-life marriages. And right before the break, we started talking about in particular, how it relates to long-term care costs. We've had, I think, two episodes about veterans' benefits and the importance of veterans' benefits to help cover things like in-home care assistance, or assisted-living, or even nursing home care. And that those veterans benefits can be available to a veteran or the surviving spouse of a veteran, but of course that surviving spouse has to have been married to the veteran at the time of death, and not remarried.
Lisa
Right.
John
So sometimes, the marriage itself can cut off access to a benefit that might otherwise have been available out there.
Lisa
Well, and of course, the other side of that coin, John, can be that perhaps the marriage itself can open a door to access to...
John
Well, I gave a presentation here recently to a group of ladies, and I told them. I said there's lots of young men coming back from Iraq and Afghanistan, and many of them are single, and so if they were looking for somebody to get married to, they would then become the spouse of a wartime veteran. And even though they weren't married to 'em while they were in combat, that's irrelevant. As long as you're married to 'em for at least one year, you could become eligible for some of those veterans' benefits. So, yeah, it can work both ways. But probably one of the biggest costs when it comes to long-term care is nursing home cost, and because at $4,500 or $5,000 a month, most people cannot afford that. And even with a married couple, they might have enough combined income to pay for one of them at that level, but they don't have enough combined income to pay for that one and the other person still be able to buy groceries, and pay rent, and mortgage payments, and car payments and whatever else it takes. And so, oftentimes, people will be looking at something like Medicaid to help cover that. And, Lisa, I bet you have heard this same thing where we're talking to that family and maybe it's a husband that's in the nursing home, or maybe it's a wife in the nursing home. We start asking about assets, and they say, "Well, this is mine and this is his".
Lisa
Yes, when we started talking about assets, looking at, "Are there any programs available that might assist with those long-term care expenses?" As we start that conversation, oftentimes we will get, "Oh, well that's my IRA," and "Oh, well, that's his inherited property," and "That's my savings account or my CD that I had before we even got married." And so, the person we're talking to is thinking that maybe that should take those assets off the table. [chuckle] However, the law is that when it comes to long-term care and applying for programs that may assist with that expense, any asset of either spouse, no matter when it was acquired, is a resource that is considered to be available, if it's not otherwise exempt, for the care of the institutionalized person. So, these programs don't care that it is your CD that you saved 20 years ago before you had even met your current spouse, that is irrelevant.
John
Yeah. So let me give you a real concrete example. Here's a man and a woman and they've both been widowed, but they found each other and they found some companionship together. And when the soon-to-be husband was married with his previous spouse, they had bought a house and paid it off, and that's where they lived. And the soon-to-be new wife, when she and her husband was alive, they had bought a house and paid that house off. And so, here are these two people, have gotten married, and the only assets that they have are these two houses. And they decide, "Well, you know what? There's no sense... Here we are getting married, we're gonna pick one of these houses and that's where we're gonna live, and we'll just rent out the other one, or maybe we've got some grandkids and they need a place to stay. We'll just let them live in it." And then a few years goes by and one of them has a stroke or somehow finds themself in the nursing home. Well, one of the things we've talked about is that in order to qualify for Medicaid, you can have a house worth up to $535,000 and still qualify for Medicaid. But notice I said "any house", not two houses, one house.
John
And here's a situation where they've got two houses. That second house counts towards their eligibility for something like nursing home Medicaid, and because that house probably has a pretty significant value, they're not gonna be able to qualify for that benefit because of that house.
Lisa
Right. And so, we opened the program today talking about how a lot of people that are going into second or late-life marriages think about prenups. And so, the next question that comes to mind is, "Well, why not just do a prenup agreement where we line out very specifically whose property is whose, and that way we don't have this problem when it comes to applying for long-term care?" Now, John, is that something that works?
John
Not one bit. The Medicaid rules don't care about whether it's separate property or, let's say you did a prenup and in that prenup you said, "No way am I using any of my assets for the other person," and it was all in writing and all agreed to, none of that matters. From a long-term care Medicaid standpoint, if it's in the name of one of you, it's y'alls, to use a good Southern term. There is no mine or hers or his, it's y'alls. And no prenup is gonna change that. And so, you can imagine, and we've had these very situations where we have somebody that needs that long-term care, and really the only assets they have are these two houses. And one house is exempt, but the other house counts, keeps them from getting the care they need. But unfortunately, you can't use a house to pay for your care without selling it, or mortgaging it, or something. And of course the person whose house is about to get mortgaged or sold to have to pay for the other person's care, that's never what they intended. The reason they kept that house around is because they figured, "Oh, well, when I pass away, I'll leave that house to my kids." They may have even done a will that said, "When I die, I leave my house to my kids," never thinking that this long-term care needs of their spouse, who they've married late in life and who had nothing to with that house, might jeopardize their ownership.
Lisa
Well, in that same way, the house they're living in, if that's the home that is owned by the person who needs that type of care, their will and all may have it set up to where that house goes to their children or grandchildren, so their spouse is not provided for. So, we have the spouse who's healthy and at home, their house is on the chopping block here, but they don't have any other security and any asset separate and apart from that. So, it can get a little sticky. Alright, well, we're gonna finish this segment, and when we're gonna come back and talk about some of the other issues that late-life marriages and blended families can cause in retirement and as we age, so stick with us.
Lisa
Welcome back to Aging Insight. I'm Lisa Shoalmire and I'm here with John Ross, and today we're talking about the potential of late-life marriages and second marriages, and how those marriages could impact issues that come with aging. And John, I think sometimes people think we're just a big stick in the mud because we're always talking about the disastrous problems that can come about from... Really, to find companionship and joy later in life is... That's living. And so, I don't wanna...
John
It is. But you know what? I will tell you. Right before we came over to film today, I had a meeting with a couple of clients. They just stopped by, they had a quick question about something completely unrelated. But as the husband was walking out, he said, "John, the planning you did," he said, "You know I have slept better every night since then?" And so, it's not that we're trying to put a big rain cloud on your newly-wedded bliss, but what we know is that if you address some of these potential problems so that they don't become really bad problems later, that you can relax and enjoy that. We've seen so many people who have just worried themselves to death about these issues, when we know that you can address them. And oftentimes, the solutions can be very simple. Especially when it comes to... We talked about from a long-term care standpoint, and that's a big one, that's a huge one. But the next little step of this is oftentimes, if it's a second marriage, you've probably brought kids into the marriage and typically, you're planning for those kids. Again, you accumulated your own assets, and this spouse that you've married accumulated theirs. And you want yours to go one way, and they want theirs to go another way. But again, here's some situations where the law can dictate things that maybe you didn't realize.
Lisa
Yeah. For instance, that second, that late-life marriage, if someone passes away and they're married, then that spouse is typically going to have a right to continue to occupy whatever home it was that the two of them held as... Or were occupying as a married couple. And if that was not originally the property of the surviving spouse, then there might be some adult children out there who essentially, their parents' whole estate is wrapped up in the value of that home, and now there's nothing they can do because the surviving spouse is still living there.
John
Well, and let me give you an example. So I had a client, and this lady had come in, her second husband had died. And while they were married, they had talked about... They both had their own houses when they got married, and they had moved into his. And they had talked about that when... If he died, that she ought to be able to live there for about six months, but after that six months, she probably ought to go ahead and move back to her own home, and that way his kids could sell that house or do whatever they needed. And so, he went so far as to do up a will, and in the will he said, "Well, I've got this house, and I want my spouse to be able to live in it for about six months. And then after that, then I want the house to go to my kids." Well, circumstances had changed. And by the time he died, the wife no longer had another place to go, and her question was, "Do I really have to leave in six months?" Well, this was a Arkansas case, and Arkansas gives a spouse a right to what's called "take against the will". In other words, that spouse can treat you as if you died with no will at all and just take what the law would have provided, which, in this case, is a right to occupy the home for her lifetime.
John
And here's where there was some intention, but even those intentions that were put into wills, because the person who prepared these wills didn't have a good understanding of how the law impacts this, those intentions were not carried out. And what ended up happening? Well, it was a big fight, and the kids weren't happy, and the surviving spouse wasn't, and nobody was happy. So don't do that. Don't create these. You've got to know how the law is gonna impact these situations.
Lisa
One of the other issues we see quite frequently with later-life marriages is when that health crisis comes to the husband or the wife, and the adult children are all coming in and checking on things, sometimes the adult children try to push out that new spouse. Maybe that new spouse has been the new spouse for 15 years. [chuckle] But that's not their mom. And so, it's almost as if these adult children sometimes come in and try to wall out that spouse. So it's important to have documentation in place, health care powers of attorney, HIPAA medical privacy releases that give your spouse the rights you want them to have in the event you are weakened by a health crisis, so that way... Maybe your children are well-meaning, but that they are jumping ahead of what you intend to be the decision-making and information dispensing going on at a hospital.
John
Right. Yeah, the key is don't just assume, and we see that all the time. People will say, "Oh, well, I'm the spouse, so I can make that decision." But then there's a kid that's saying, "Well, I'm the kid, so I can make that decision." Ultimately, it's your decision. You decide who you want to help you out when those times come, and then make sure you get that in writing in really good quality powers of attorney that address these sort of issues, and as a big part of all the rest of your estate planning stuff.
Lisa
Yeah. So mazel tov on your second or late-life marriage, but make sure that you get some planning in place that addresses some of the concerns that are very common in that situation. So, we're at the end of another issue of Aging Insight, so we hope to see you next week and every week right here.
John
Bye-bye.

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