Second marriages can make estate planning a little more complex but it can also make estate planning that much more important. Estate planning can both protect the children of each spouse and also protect the new spouse from the children.
The first step in estate planning with blended families is often to ensure all ex-spouses are removed from titles and beneficiary designations of assets (unless ordered by law to keep the spouse listed). Many people remarry without removing the ex-spouse and there is little the surviving new spouse can do if the deceased inadvertently forgot to change documents.
Second, review the needs of the children and how assets should be distributed. Assets can be designated for your children only rather than being distributed to the new spouse or the spouse's children.
Third, look at the needs of your new spouse. If you have the bulk of the assets which ultimately will be distributed to your children, it is possible to provide for your new spouse until he or she passes. This step is called creating a "life estate" in which a person has use of assets until he or she passes.
Choosing successor trustees can also be more complex if adult children of a blended family are being used. Solutions can involve just one trust, multiple trusts or simply using beneficiary designations on accounts to distribute funds within blended families. Consult an attorney for advice on how to plan wisely with a blended family.Recommended Pages to Read Next