Special Estate Planning Issues for Blended Families
Statistics from the Pew Research Center note that a full 42 percent of all Americans are in a "step" relationship. This means that you or someone you know is very likely one of the 95.5 million people who are part of a blended family.
Estate planning for the millions of Americans who are divorced, remarried and widowed is available and essential to a secure financial future. But it can be tricky because there are numerous ways in which your estate plan can go wrong. The stakes are higher if you want your estate left to a current spouse and family versus your former spouse.
Problems in Estate Planning for Blended Families
Spouses and families, current and former, are not always able to come to an amicable agreement on important issues. Issues such as custody of children and fair division of assets can become highly contentious.
This is why considering all facets of your situation in advance will minimize the number of disputes over the estate plan and prevent enmity among surviving family members.
Here are some questions that may loom large in a blended estate plan:
- How would you want your assets handled when you die?
- Who will make decisions in your place if you were unable to make them for yourself?
- Who will take care of your children — a stepparent or natural parent?
- Who will assume guardianship of any children under 18 — a current spouse? The natural parent? An ex? Will the children get to weigh in on this decision?
- What will happen to the surviving spouse — how do you balance the needs of children from the first spouse with the needs of the second spouse?
- Will your surviving family have a significant amount of decision-making power over your estate — or a very limited amount?
- How flexible will you be in a conversation together with your attorney, current spouse and former spouse?
- Are you currently sharing a residence in a community property state, or living in separate locations?
When you're ready to contemplate these questions, take time to consider the wealth and age differences between you and all spouses — past, present and future. If you plan on remarrying, will you want to enter into a prenuptial agreement? If there's a big age difference, will the younger spouse be taken care of? Does your spouse have a fair claim to some portion of the assets, over your children from an earlier marriage?
Discuss Your Estate Plan for Your Blended Family
Planning ensures the prosperity of your surviving family and gives structure to the division of your assets and legacy after you’re gone. With a better idea of what you think should happen, you should discuss your plans with a qualified estate planning lawyer, who can formalize them and add legal structure. In this case, it is important to seek out an estate attorney familiar with the various complexities that stem from blended families.
In bringing together multiple families, you'll need to ensure that everyone receives the inheritance that he or she was intended to receive. Even though newly blended families might still be adjusting to their new lives together, estate planning shouldn't be put off any longer than necessary. You want to devise a plan that will accomplish your goals.