Yours, Mine & Ours: Estate Planning for Blended FamiliesAugust 1st, 2013 | written by Nancy Larson
Yours, Mine & Ours: Estate Planning for Blended Families
The number of households with stepchildren has doubled in the last ten years, so it should come as no surprise that you may be the parent or grandparent of a “blended family.” Are you prepared?
A blended family brings together children, assets, and often different family values and cultures. The history and present circumstances of two distinct families coming together can be complex and sometimes volatile as often times one or both families have dealt with a painful divorce or death. Bringing those issues under one roof takes commitment, planning, and pulling together. Some blended families come into the union from a position of distrust and suspicion, while others are naturally more in sync. Over time, the dynamics often change.
Strong loyalty outside of the blended family unit add to complexity. These are all factors to consider in estate planning, and need to be taken into account when choosing your executor, trustee, and/or guardian. About one-third of all weddings in the United States create step-families, according to the National Center for Family & Marriage Research. In a first marriage, a spouse typically wants all assets to pass to the surviving spouse, then equally to the children at the death of the second spouse. In a blended family where a couple has one or more children from a prior relationship, planning may not be so simple.
What about the kids? Adjustments may be needed if there is a significant age disparity between spouses and between two sets of children. After discussion with your spouse, clearly state custodial and guardianship preferences in a will. If you don’t, the state will step in and decide for you where your children will live and who will manage your children’s inheritance. Do you want your husband’s next wife to have any influence over the management of your children’s inheritance?
The need for clear communication in the parental estate planning is of great importance and must also take into consideration the distinction between half-siblings and step-siblings. Further, children may have multiples sets of grandparents and step-grandparents, all of whom may consider a child as part of the family and yet should they also make provisions for the step-grandchild — or just the biological grandchild?
Having biological and stepchildren or step-grandchildren in the mix requires you to clearly outline what and who is important in your estate plan. If you are a parent or grandparent in a blended family, drafting a will (and sometimes a trust) is essential to carry out and to protect your wishes. Don’t be too hasty to reassign family heirlooms or assets to new blended family member.
Remember: there are no ex-parents or ex-grandparents; only ex-spouses. Choose carefully in who takes responsibility for your estate and managing it after your passing.
Consult a trusted and patient estate planning attorney to work through the issues of estate planning for a blended family.