With the high incidence of divorce and remarriage, blended families are becoming the new norm. Unlike the traditional nuclear family, there are many aspects of a blended family that require careful and honest evaluation in order to avoid unintended surprises for subsequent spouses and children upon your passing. The most common estate planning challenges with blended families include:
1. Balance—Balancing your desire to provide for your subsequent spouse during his/her lifetime with your desire to provide for your children during their lifetimes can be a significant challenge. This challenge is further heightened when there is a minimal disparity between the age of your subsequent spouse and the ages of your children.
2. Avoiding the Will/Trust Contest—Avoiding a costly, emotionally draining will or trust contest is one of the greatest challenges in estate planning for blended families. Without an effective plan in place, your estate may be the subject of a long battle that significantly reduces its value and places those you loved the most at odds. This is a common occurrence that all too often pits your new spouse against your children.
3. Unintended Disposition—If you pass away without a will or properly funded trust in place, your assets will pass under the laws of intestacy. These laws will result in a disposition of your estate that may surprise your new spouse and leave him/her without sufficient assets to care for themselves during their lifetime. Moreover, it will most likely not result in a disposition of your estate according to your wishes.
4. Children of Multiple Marriages—Providing for children of multiple marriages can be a significant challenge. Will you treat your spouse's children the same as your own, or will you provide that your assets pass only to your children? These questions require having honest, candid conversations with your spouse and seeking counsel from an estate planning attorney.
5. Beneficiary Designations—Ensuring your beneficiary designations align with your overall wishes and provide the appropriate balance between your new spouse and children is a significant challenge that requires effective coordination and careful planning. If you forget to properly coordinate these designations, it can greatly undermine the disposition of your estate.
Like holiday planning for blended families, estate planning for blended families presents a myriad of challenges and potential pitfalls. If you have any questions about estate planning, we would encourage you to call or schedule an appointment to visit with us.