In our house, we always refer to ourselves as a modern family. We joke that the post office must get confused because we have three last names in the house. No, we have not taken in renters. We are a blended family.
When I married my lovely wife, I was immediately blessed with step-fatherhood because my wife had a young daughter from her first marriage. A couple of years after the wedding, my wife gave birth to our first child. To our surprise, number three was not far behind. He showed up about 11 months after #2! [No, that was not planned.] Now, our loving family has three wonderful children. When it came to doing our estate planning, the scenario was challenging (to say the least.)
As a blended family, our planning concerns shifted beyond simply “who gets what” or “how much asset protection is needed.” The relationship between my wife and her ex- continues to be governed by agreements that were made during their divorce. Thus, the plan for my stepdaughter is different from what my wife and I might put into place for all three children. Our plan did get done, though I definitely needed to work with an experienced estate planner to work through the issues of asset distribution, passing of legacy, and guardianship planning.
When my wife and I worked through this process, our paramount concern was that we kept the siblings together. In my eyes, my stepdaughter is as much my daughter as my natural born children. Therefore, my wife and I had to create our plan that preserved sibling unity and cooperation.
In today’s modern family, the concept of “yours, mine, and ours” is very common. The blended family is a product of re-tying the knot, in which one or both members of a couple have children from prior relationships. The blended family dynamics can include children, step-children, former spouses, and a collection of in-laws. Estate planning may seem complicated and confusing for the blended family, but with planning, communication and a trusted advisor by your side, you will be on the right path to protecting your beloved family and your future.
If you have or are part of a blended family, it’s important to understand how estate planning could be exactly what you need to keep your family out of conflict, both during life, in the event of incapacity or death. The biggest question in blended families is “Where does my money go when I die?” Remarried couples want to provide for the surviving spouse and that the children from their previous marriages become beneficiaries of the assets that they brought to the union. The challenge here is to keep all parties satisfied with the chosen course of action.
Estate Planning Challenges
There are many challenges that blended families face but you are better armed when you have an understanding of where potential conflicts could arise. Such challenges can include:
- The potential for children to be disinherited
- Delays in the children’s receipt of their inheritance
- The need to protect assets from former spouses
- Disputes over division of authority
Let’s say you had a daughter from your first marriage, you later remarried and had a son with your new spouse. Unfortunately you pass away, leaving all your assets outright to your new spouse. Your widowed spouse is free to act as they wish with your assets. Your spouse may now focus only on themselves and your son, who will benefit from the assets you have left behind. The result of this scenario may be that your daughter will feel unloved, forgotten, or resentful that you did not plan for her.
You may think that this can be avoided by leaving everything to your new spouse or partner, and then on their death, to your children. But, this too could set up a scenario where your children feel the need to monitor your spouse/partner’s use of your assets, during his or her life. That conflict can certainly cause your family to drift apart and that may not be what you want for the long-term. Thinking ahead and taking time to determine your beneficiary designations can help maintain family harmony through this process. Working through these details can not only avoid future estate planning conflicts but also help maintain healthy relationships between all parties involved.
Conversely, you may have a partner or spouse that you have not planned for since tying the knot but you would want them to inherit some or all of your assets. But, as things stand right now, your entire estate may go to your children from your prior marriage. This could create a reality where your current partner faces hardships such as losing their home that you currently share and having no income to rely on if something happens to you before your plan is updated.
Communication is Key
Estate Planning can assist with smoothing out the difficult times, but it is not a cure-all in itself. This is why we encourage strong and solid communication between all family members. Having an honest conversation with your spouse and your loved ones can help alleviate your concerns and allow you to set expectations for how your finances, assets, and goals for the future will be handled once you are gone. These conversations can be difficult and emotionally charged especially with children of any age involved. With a well-thought-out estate plan in place, you are preparing your family to have a smoother transition during such hard times and possibly allow them to build stronger bonds afterwards.
Estate planning is here to assist your unique family, allow you to build a strong family throughout your lifetime, and bring harmony through the rough times. Remember that the most important thing is to do something. With blended families, a failure to plan will result in a worst-case scenario:
Picture this: you pass away with no plan in place. The state’s rules on what happens when no will is in place means everything goes outright to your current spouse. But, your former spouse produces court orders from your divorce that require you to have provided a legacy for the child of your first marriage. The probate process drags on because courts move at the speed of lazy snails. Your children, all of them, are put in the middle of your quarreling current and ex- spouse. The children you raised and taught to be loving and supportive siblings have their relationship disintegrate. No one wants this.
Fortunately, there are many better options.
If you are the child of a parent who has remarried or re-partnered, after a divorce or death, of your other parent, you may want to bring up these issues to your parent’s attention. Communicating your concerns now can help settle and resolve any issues in the future.
If you are ready to create a well thought out estate plan for your blended family, start by sitting down with us. As your Personal Family Lawyer®, we can help you plan for the needs of your unique family. Our Family Wealth Planning Session guides you to protect and preserve what matters most. Before the session, we’ll send you a Family Wealth Inventory and Assessment to complete that will get you thinking about what you own, what’s most important to you, and what you can do to ensure your family is taken care of.
Oh, if you’re still wondering how we have three last names in the house, the equation works out like this: My 2 natural children and I have one name, my stepdaughter has her father’s last name, and my wife (independent and strong woman that she is) kept her maiden name. One fun discussion we had regarding child number 2 and number 3 was if we might hyphenate to give the kids both our names, but we figured that it would be too much to print on the back of a team jersey.
This article is a service of Yolofsky Law, P.A. We offer a complete spectrum of legal services for businesses and individuals. We can help you make the wisest choices on how to deal with your business throughout life and in the event of your death. Our passion is helping you create and maintain wealth, then pass that wealth and the knowledge that got you there to your loved ones. We love what we do.