18 Jun Will my wife get my house when I die?

Q. I am currently married but I purchased a home from my mother before my marriage. I added my younger sister to the deed at the time of purchase so the house would remain in the family if something happened to me. I have been paying the mortgage and bills myself for three years now. But now that I’m married to a great woman, who would get the house when I die?
— Happy but planning

A. Congratulations on your happy marriage.

Most of life’s transitions — marriage, divorce, new job, birth of a child and more — are the catalysts to address your estate and financial plan.

The decisions you made before marriage as a bachelor may not align with the future you now envision with your new spouse, said Amber Leach, a certified divorce financial analyst with AXA Advisors/R.I.C.H. Planning Group in Morristown.

But to answer your specific question, we would need to know how you titled the house upon purchase. The titling of any asset can impact the way it would be passed on in the event of your death, Leach said.

For real estate, most commonly, you would have titled it either as Tenancy in Common or Joint Tenancy with rights of survivorship.

“If you chose Joint Tenancy with rights of survivorship then upon your death, the house would avoid probate and pass entirely to your sister,” Leach said. “By operation of law, your sister would be the full owner of the house that you and your wife had been living in and paying all the bills for.”

If you chose Tenancy in Common, upon your death, your half of the house would go to your estate, Leach said. This does not avoid probate and the rights of the estate will be determined according to your will.

Both situations are not ideal for your wife, Leach said, and could leave your wife in a precarious situation upon your death.

Leach suggests you start the discussion with your sister and a real estate attorney who can help you to draft an agreement or help you change the titling of the house.

“Your will and beneficiaries should be updated and using an estate planning attorney would be recommended,” she said.

She recommends you also seek out a financial professional that can help you address these issues, including your life insurance needs to provide for your wife after your death.

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This story was originally published on June 18, 2020.

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.