How Do Blended Families Handle Estate Planning?

Blended families often face complex estate planning challenges. If you are raising a blended family, you need to ensure that your trust protects your current spouse and children from your previous marriage.

Open and honest communication is the key to happiness within blended families. Talk to your spouse about your wishes. Work with an estate planning attorney in Santa Rosa to figure out ways to protect your family and assets.

Here are some estate planning tips for blended families.

Update Documents

Before blending two families, update the documents related to your estate to ensure they reflect your new familial status. Remember to change the beneficiary on your insurance policies and retirement accounts. If you do not update beneficiaries after remarrying, your executor won’t know your new wishes.

Choose Your Trustee Carefully

If you die suddenly, a battle can arise between your ex-spouse and your current spouse over asset distribution. Your current spouse may want to give everything to their children. This can cause tensions between them and your biological children.

To ensure your wishes are respected and to prevent disputes, choose an experienced trustee. Look for a person you can trust. Your trustee must have a good head on their shoulders. They must be capable of making informed investment decisions.

Consider Setting Up a Trust 

Consider setting up a trust that leaves assets to your spouse for their lifetime with the balance passing on to your kids on your spouse’s death. If both you and your spouse brought assets into the marriage, consider creating a joint pour-over trust.

Under a joint pour-over trust, an umbrella trust is created. Both you and your spouse can create a separate trust under the umbrella trust. Upon the death of a spouse, their assets are rolled into two separate trusts(according to a predetermined allocation).

The trust provides for the surviving spouse, but they cannot change how the assets are distributed. When the surviving spouse passes away, the assets in the trust are distributed between the first spouse’s biological children.

This is just one of several arrangements. You can make arrangements to enable your children to withdraw money for their education while your spouse is still alive or can instruct your executor to continue holding the money in your trust even after your spouse passes away.

Decide Who Will Make Healthcare Decisions

Use your living will or healthcare directive to communicate your healthcare wishes. Appoint a person who can make important decisions on your behalf if you become physically or mentally incapacitated. When creating your will, remember to include provisions to ensure your spouse is taken care of if you become incapacitated.

Johnston & Associates Law is a team of experienced and adept estate planning attorneys in Santa Rosa. Our attorneys leverage their experience and know-how to create customized legal solutions for clients. To enquire about our legal services, call 707-545-6542.