Navigating Financial Challenges When Remarrying at Retirement Age.
Later life is full of unique challenges, from adjusting to a new life without the purpose of the working week to balancing the books in a difficult, high-inflation economy. Later life isn’t all stress and worry, though, and sometimes the best things can happen to us as we reach pension age – including marriage.
Love truly knows no boundaries, and you may be lucky enough to experience love in your later years. There should be very little stopping you from fully engaging with that love, but it is of no surprise that you might be concerned about the more logistical and financial aspects of such a union. How can you navigate finances with later-life marriage?
Financial Planning
As older people, you will have the benefit of time and experience when it comes to issues of finances. You will also have the benefit of full and separate lives, lived richly and with some riches earned in return. These prior experiences and assets will both make your matrimony extremely easy and extremely difficult.
This is why it is wise to start the financial conversations early, so you can structure everything as you’d like as soon as possible. You both might have ideas about which money and which assets you’d like to keep to yourself, and how you’d like to manage the household as a team. This is also a good point to consider the home in which you’ll live, and the equity therein; a lifetime mortgage could be a valuable way to access finances necessary for short-term renovations, and the two of you can arrange between yourselves how best to share the load.
Legal Considerations
Marriage is a union of two lives, and a hugely romantic thing to do particularly in later life. It is also a legal process, and one with ramifications for your assets and situation – albeit mostly positive. For one, you are able to avail of the Marriage Allowance, which allows you to transfer a little over 10% of your Personal Allowance to your spouse, potentially saving them (and hence your household) hundreds in tax costs. Marriage also, of course, can blur the lines between what is and isn’t shared – with potentially difficult consequences in the event of a divorce.
Estate Planning
Arguably the most significant consideration to bear in mind is that of estate planning. Marriage brings a bevy of important legal considerations with relation to the estate, allowing spouses to benefit from unique allowances and exemptions for the betterment of their own situation.
If one of you were to die, the other would be able to receive the entirety of the deceased’s estate without Inheritance Tax being levied; the other would also receive any unused nil-rate IHT exemption for their own estate, effectively doubling the threshold before which tax is payable. These are powerful points that make later-life marriage not only beautiful, but highly practical from a financial standpoint.