Beware the risks of new love in late life

RETIREMENT has always been a great time to try something new – and for hundreds of us every year that includes a new marriage.

In 2016, men were more likely to get married after hitting the age of 80 than they were under the age of 20. In fact, 644 men aged 80 and above tied the knot that year.

In the past 10 years, marriage rates for men over the age of 65 have risen by 32%. For women it’s much higher – 78%.

There’s plenty to be said for marrying later in life. It means comfort and companionship in those retirement years.

However, getting married in retirement comes with complications, warns Sarah Coles, personal finance analyst at Hargreaves Lansdown – from the impact it could have on your income to the effect on your children.

So before you risk the discomfort of going down on one knee, Sarah shares 10 things you should consider:

1 Benefits

Some benefits could be cut from the moment you move in together. If you get meanstested benefits, such as housing benefit or pension credit, your partner’s income and savings are added to yours to work out if you’re still eligible. If your previous spouse died and you get bereavement benefits, you’ll lose them when you move in together or remarry.

2 Spousal maintenance

If you’re divorced and get spousal maintenance, this usually stops when you remarry. Even if you just move in together, if you become better off, your ex-partner could ask to reduce or stop payments.

3 Widows pension

If you’ve been widowed and are getting payments from your late spouse’s private or workplace pension, those payments might stop if you marry again. It depends on the rules of the scheme, so you need to check this.

4 Property

If you both own a property, you could run into tax problems. Tax rules mean that when you sell the home you live in, there’s no capital gains tax to pay. So if you have your own home and one of you sells up to move in together, before you get married it’s tax-free. Once you’re married, you can only have one main home between you, so if you sell the other house more than 18 months after getting married, you may have to pay capital gains tax.

5 Pension benefits

Your own pension may pay benefits to someone else when you die – especially if it’s a final-salary pension from work. Some automatically pay out to your new spouse, but others will be set up to pay the person you were married to when you joined the scheme, so you need to fill out a nomination of beneficiaries form to redirect payments to your new spouse.

6 Child maintenance

In the unlikely event you’re getting child maintenance, your ex may ask to cut payments if your financial situation improves. If you’re paying child maintenance, and you marry someone better off than you, your ex could ask for more.

7 Life insurance

You should contact your life insurer and check how it will pay out after your death. It may go to your spouse already, or you may need to make changes.

8 Inheritance

You could accidentally disinherit children if you’re not careful. When you remarry it will void any existing will, so unless you make a new one, you’ll be treated as not having a will – so your children may not get what you want them to have.

The other risk comes if you give everything to your spouse to avoid inheritance tax on the understanding they will pass it on to your children after their death.

Unfortunately, there’s nothing stopping them leaving it to someone else, so it’s important to write a new will making your wishes clear, and consider bequests direct to your children.

9 Tax planning

It’s not just the pitfalls you need to watch for, there are money-saving opportunities to take advantage of too. If one of you doesn’t pay tax, you can move investments and savings into their name, and cut your tax bill. Once you’re married, transferring ownership like this won’t trigger a tax bill.

10 The marriage allowance

Everyone has a tax-free personal allowance. If you’re married and one of you is a nontaxpayer and the other is a basicrate taxpayer, the non-taxpayer can transfer a chunk of their allowance to their partner. This will reduce their tax bill by up to £250.

There’s lots to be said for marrying in your autumn years, but consider the impact it could have on your cash