Divorce is a reality in today’s world. Numerous studies indicate that 50% of marriages will end in divorce. Of course, many divorced individuals go on to remarry. And, of those who remarry, many have children from prior marriages. Hopefully, remarriage results in one big happy “blended family.” However, a blended family comes with a unique set of estate planning and inheritance issues that must be addressed.
For example, how will you handle the assets that each of you accrued prior to remarrying? This includes property and other financial assets as well as material items such as jewelry, furniture, all sorts of personal mementos. Should the bulk or all of these assets go to your biological children? Do you want to leave something to your stepchildren? Do you want to provide for your surviving spouse? The list goes on and on. Without proper estate planning, you run the risk of unintended consequences after you’re gone. Your kids may not get what you planned. There may be insufficient funds for your surviving spouse. Family feuds and legal actions may ensue.
While there are many issues you will need to address, here are some things to start you off:
1. Pre-nuptial agreements (“Pre-nups”) are useful tools for specifying what each of you owned before remarriage.
2. Make sure you have a Will. (And, if you have a Pre-nup, make sure your Will and Pre-nup are consistent.) Without a Will, your assets will be distributed according to state laws, and these laws may be inconsistent with your wishes.
3. Consider establishing a trust to provide for your surviving spouse. A properly drafted trust will enable the surviving spouse to receive income and/or principal from the trust’s assets during his/her lifetime. However, when your surviving spouse is gone, the principal can be distributed among your heirs as you intended.
4. Review any beneficiary designation forms you have for retirement accounts and insurance policies. Frequently, people forget to update these forms when they divorce or remarry. But, it’s important to update these documents to insure that your assets go to your intended beneficiaries.
Getting Legal Help
Experienced Estate Planning Attorney, Elga Goodman, can help you understand the various issues and options available when planning involves a blended family. She can help ensure that your assets are distributed in keeping with your wishes. Contact us today at 973-841-5111.
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