Combining finances after 65 can be complex. Learn practical strategies for newlywed seniors to merge money matters while protecting personal assets.

Getting married later in life can be a joyful new chapter. Whether it’s a first or second marriage, sharing your life with someone at an older age can be rewarding. However, as exciting as it is, combining finances after age 65 comes with its own set of challenges and considerations.

Many seniors have built decades of financial habits, savings, and responsibilities, and blending all of that with a partner can be tricky. Here are some strategies for newlywed seniors on how to approach the process of combining finances after 65.

Plan for Medical and Long-Term Care Costs

Healthcare expenses are often a big concern in retirement. Medicare is individual insurance, so you can’t be on the same policy as your spouse. However, how you file your taxes and your income level can affect the Medicare cost for the monthly premiums for Part B and Part D premiums. Marriage can also affect Medicaid eligibility, depending on combined income and assets, and the state you live in.

Additionally, you should talk about how you’ll handle long-term care if one of you becomes ill. Will you use your savings, rely on insurance, or look into Medicaid? Have this conversation early, while both of you are healthy, and consider long-term care insurance if it makes sense for your financial situation.

Talk Openly About Your Financial Histories

Before making any decisions, have a clear, honest conversation about your financial situation. This can include income sources, debts, assets, pensions, Social Security benefits, monthly expenses, and any potential financial obligations to children or previous spouses. Transparency is key here. Surprises down the road, such as hidden debts or unspoken obligations, can negatively affect a relationship.

Also, it can be helpful to discuss your individual financial views. For example, some people are savers, while others are spenders. You don’t have to agree on everything, but understanding each other’s financial mindsets can help avoid future conflicts.

Understand How Marriage Affects Social Security

Marriage can impact Social Security benefits, particularly if either partner already receives benefits based on a previous marriage. In some cases, getting remarried can change or reduce those benefits. At the same time, it may open up eligibility for new benefits through your current spouse.

Since the rules can be complex and depend on individual circumstances, it’s a good idea to consult the Social Security Administration directly or use their online tools to see how your benefits might be affected.

Consider Keeping Some Finances Separate

Many senior couples decide not to merge their finances fully. Keeping separate checking accounts or investment portfolios can allow for financial independence, especially if both partners bring various assets into the marriage. Some couples choose to maintain individual accounts for personal spending and set up a joint account for shared expenses like rent, groceries, or travel.

There’s no right or wrong way to do this. The key is to find what works best for both of you. Keeping some funds separate can also protect each person in case of a health crisis, long-term care, or even death, especially if there are children from previous marriages.

Review and Update Legal Documents

Although love is the primary focus of marriage after 65, it’s also a legal and financial partnership. After the wedding, update your wills, powers of attorney, healthcare directives, and beneficiary designations. This is particularly important if you want your new spouse to have certain rights or responsibilities in the event of illness or death.

In blended families, estate planning is also important. You may want to ensure that children from previous relationships receive certain inheritances or that your spouse has a right to remain in the home if something happens to you. A qualified elder law attorney or estate planner can help you set up documents as needed.

Watch for Tax Implications

Getting married later in life can affect your taxes. Your filing status may change, which can influence how your income is calculated and taxed. This may impact how much you owe in taxes each year, specifically if you’re taking income from retirement accounts, investments, or other sources like pensions. In some cases, your total tax bill could increase or decrease depending on your combined income and deductions.

Marriage might also affect your eligibility for certain financial assistance programs. Some government or healthcare programs use income levels to determine who qualifies, and combining your incomes could change your eligibility. For example, programs that help with medical expenses or offer discounts based on income might reevaluate your eligibility after marriage.

Because everyone’s situation is different and tax laws can be complicated, it’s a smart move to speak with a tax professional who understands the needs of retirees.

Conclusion

Combining finances after 65 involves careful thought, honest conversations, and sometimes professional guidance. Every couple is different, and there’s no one right way to handle money in a marriage later in life.

By taking the time to understand different financial topics after 65 and to make informed choices, you and your spouse can set yourselves up for success. This way, you can enjoy this new stage in life with less unnecessary stress.