Estate Planning considerations for blended families
IN THIS DAY AND AGE there is no standard “modern family.” Blended families are the new norm, with parents bringing children from prior marriages into their new union.
Here are some tips to help transition your estate plan after remarriage:
1. CONSULT an estate planning attorney. Unique issues arise with regard to succession in blended families. An experienced estate planning attorney can counsel you on the right plan for your needs.
2. DESIGNATE your beneficiary. This is key, as the beneficiary receives your assets, even if your will or trust states otherwise. If you forget to remove your ex-spouse as your beneficiary following a divorce, they will still receive your money. In cases where multiple beneficiaries are designated, ensure beneficiaries are listed properly. One common misconception is that a
primary and contingent beneficiary split the proceeds. This is not the case; instead the primary beneficiary takes one hundred percent. Only if the primary beneficiary is not alive will the contingent beneficiary be able to accept the assets.
3. CREATE a trust for each spouse and designate a neutral third party as the successor-trustee. Your new spouse and children will have interests that are diametrically opposed with regard to your estate. Specifically, when a spouse is both beneficiary and successor-trustee they may manage the assets to their advantage, leaving your children to suffer. A neutral third party as the successor trustee will counter-balance and allow assets to be properly distributed.
A well-crafted estate plan alleviates stress and headaches down the road, allowing newlyweds and blended families to enjoy their time together.
In need of assistance crafting or revising your estate plane? The attorneys at Gallagher, Westholz & Potter are here to help. Click the TAKE THE NEXT STEP button for a free case review.