Blended Families

In today’s society more and more families fit into the category of “blended family”, whether by divorce or death and remarriage.  Blended families have serious estate planning needs since there are competing interests at work.  Both parents want to make sure that their individual children aren’t at risk of being disinherited by the stepparent after the parent’s death.  However, at the same time, they want to make sure that the survivor has sufficient funds for his or her lifetime.

Here are some of the unintended consequences I have seen where families failed to properly plan:

  • Significant animosity toward the surviving stepparent
  • Significant animosity toward the step-siblings who ended up inheriting when the stepparent passes away.
  • Lawsuits over what the decedent would have intended.
  • Intestate succession (no will) resulting in children from the prior marriage inheriting and leaving the surviving spouse with less than planned.

Many couples choose to live together without the benefit of marriage and without have proper documents in place. Unfortunately, many of them are unaware how vulnerable their situation is until it is too late.

Here are just some of the benefits of marriage as it relates to estate planning:

  • Spousal right as decision maker as medical proxy, in the absence of a medical power of attorney.
  • Priority for appointment as guardian and conservator
  • Spousal entitlement to certain amounts of assets at death
  • In most circumstances, the spouse is the default heir if there is no will.
  • With no unlimited marital deduction for federal estate taxes, estate taxes may be owed on after the first partner’s death.

The good news is that with proper planning you can avoid most of these problems and make an unpredictable situation more predictable.

[Home] [About] [Contact Us] [Estate Planning] [Basic Estate Planning] [Planning for Families] [Blended Families] [Planning for Pets]