An article from The University Herald, “The Challenges and Complexities of Estate Planning for Blended Families, ” clarifies some of the major issues that blended families face. When creating or updating an estate plan, the parents need to set emotions aside and focus on their overall goals.
Estate plans should be reviewed and updated, whenever there’s a major life event, like a divorce, marriage or the birth or adoption of a child. If you don’t do this, it can lead to disastrous consequences after your death, such as unintentionally leaving all your assets to an ex-spouse.
If you have children from previous marriages, make sure they inherit the assets you desire after your death. When new spouses are named as sole beneficiaries on retirement accounts, life insurance policies, and other accounts, they aren’t legally required to share any assets with the children.
Take time to review and update your estate plan. It will save you and your family a lot of stress in the future.
You will need more than a simple will to protect your biological children's ability to inherit. If you draft a will that leaves everything to your new spouse, he or she can cut out the children from your previous marriage altogether. Ask us how trusts can help for those children. There are many options.
You can create a trust that will leave assets to your new spouse during his or her lifetime, and then pass those assets to your children, upon your spouse’s death. Another option is to have life insurance payable to either your spouse or children and then leave the remaining assets to the beneficiary that did not receive the insurance. With the help of a good estate planning attorney you should be able to design and create a plan that will take care of your family.
Be sure that you select your trustee wisely. It’s not uncommon to have tension between your spouse and your children. The trustee may need to serve as a referee between them, so name a person who will carry out your wishes as intended and who respects both your children and your spouse.
An estate planning attorney who routinely works with blended families will be able to help you work through the myriad issues that must be addressed in an estate plan. Think of it as a road map for the new life that you are building together.
Reference: University Herald (June 29, 2019) “The Challenges and Complexities of Estate Planning for Blended Families”