It’s common for parents who marry for a second or third time also to get stepchildren (or grandchildren) in the bargain.
Many find the benefits of a blended family quite rewarding, and sometimes seek to legally adopt their stepchildren.
In all events, whether the children of a blended family are adopted, biological, or step, parents will likely need to adjust their estate plan to reflect their newly expanded family.
As with any estate plan, the goal should be to transfer your wealth in a way that makes financial sense, while minimizing stress and discord amongst your loved ones after you have passed.
5 important issues to consider
Each estate plan is different and will have unique issues to address, but some common ones include:
- The will: Your will should be updated to reflect the new marriage, but it may be a mistake to transfer all assets to a current spouse without considering your children from previous marriages. A change such as this can lead to the loss of sentimental assets particularly tied to one side of the family, such as a family business; a vacation home going back generations; or other unique assets like jewelry or art. You might also consider making arrangements to protect your estate if your spouse remarries after you pass, and if you want to avoid assets from your estate being inherited by your surviving spouse’s future spouse.
- Trusts offer more control: Larger estates are often best protected by a trust, which can provide for a surviving spouse while maintaining control over how assets are distributed after to others after the surviving spouse’s death. AB trusts often are useful because they offer different plans depending on which spouse dies first.
- Pick the right trustee or executor: Many choose a spouse for this job, but these roles often require balancing extensive paperwork, understanding finance, and skillfully navigating family politics as the surviving spouse mourns the loss of their loved one. It may make more sense to choose a different family member, or a neutral third party like an attorney.
- Bypass the spouse: Perhaps it makes the most sense to pass assets directly to the children rather than further complicate the surviving spouse’s estate. Adult children who are raising families themselves, have financial challenges, or are saving for your grandkids’ college tuition, may need the assets more than your surviving spouse.
- Determine who makes healthcare decisions: Family members may not agree on the best course for medical treatment or execute an ill or incapacitated parent’s wishes regarding their care. Picking a person ahead of time who is authorized to make healthcare decisions, and knows what end of life care you desire, minimizes these disagreements.
Every family is different
You may find it helpful to work through these issues with guidance from an experienced estate law attorney. A blended family’s needs are not unusual these days, so the right estate plan minimizes potential areas of dispute amidst the larger blended family. The right estate plan will also help effectively address any unforeseen issues that might arise.
Contact Bashian P.C. for all of your estate planning needs.