Planning for the future is important for everyone, regardless of age, health, or financial status. You never know when it will be your time to go and you want to make sure that your loved ones will be taken care of after your passing. However, the growth of nontraditional families with divorces, multiple marriages, and stepchildren – or “blended families” – have made the estate planning process even more complicated.
If you’re struggling with the legal issues of planning for your parents’ or your own future when there are divorced spouses and stepfamily members involved, you are definitely not alone. According to the U.S. Census Bureau, blended families have grown at such a rate that they now outnumber traditional families, largely due to rising divorced rates and longer life spans.
The issue of inheritance can be a delicate enough topic on its own, but it can become even more sensitive when trying to balance the happiness of multiple families. Some will avoid the process of estate planning altogether to avoid dealing with conflict; however, this can have disastrous consequences.
What can go wrong if you don’t have an estate plan for your blended family?
There are a multitude of scenarios that can go awry if you don’t have an estate plan before you pass away. These are just a few of the more common problems you or your loved ones may encounter.
Your children may get disinherited
Many people don’t realize that in the event of a re-marriage, if the surviving spouse is given legal rights to all assets of the deceased spouse, the surviving spouse has no legal obligation to distribute assets to the deceased spouse’s children from previous marriages.
So let’s say you have adult children from a previous marriage and you re-marry someone who also has children from a former marriage. If your assets are owned jointly, or if you leave all of your assets to your spouse with an informal understanding that they should be distributed among all of your children, your children may end up getting disinherited. If your spouse dies, your assets will then be left to his or her children, unless otherwise specified by him or her in a legally recognized document.
We’d all like to believe that the surviving spouse will do the right thing and distribute the estate fairly, but unfortunately, this is not always the case. Even if your spouse genuinely intends to leave remaining assets to your children, if it he or she dies without a trust, the assets will automatically go to his or her own children.
The only way to make sure your children will not be disinherited is by taking the right legal steps with the proper planning, rather than trusting informal verbal agreements.
Stress and conflict drive a wedge between your loved ones
It’s no secret that death and the prospect of an inheritance can sometimes bring out the worst in people. The best way to avoid conflict among your loved ones is to communicate your wishes and have them clearly laid out in your estate planning documents.
Although it may seem easier not to deal with it at all, imagine the stress and legal battles your children, stepchildren and spouse will go through to distribute your assets in a way they deem to be fair.
If you fail to plan appropriately in advance, the only thing your loved ones will inherit is financial stress and discord during a time that should be reserved for emotional healing and support.
Your ex-spouse receives your assets
If you go through a divorce, updating documents of your estate plan may take a backseat to your more immediate concerns like dividing current assets. But if you neglect to go back through documents like your will, trust and power of attorney, you risk accidentally leaving post-divorce assets behind to your ex-spouse, rather than your children or other relatives.
Likewise, if you explicitly name your minor children as the beneficiaries, your ex-spouse – as the children’s legal guardian – will likely be appointed to manage the inheritance until the children are of age, unless your trust explicitly states otherwise.
Get Professional Legal Help to Avoid Problems
Because blended families can cause so many complex issues with estate planning, it can be beneficial to hire a qualified Estate Planning Attorney to help walk you through the process and draft documents.
An experienced attorney, like Christina Lesher, can give you the peace of mind to ensure that all of your loved ones will be taken care of in your passing and will not be left to deal with conflicts and legal battles.