Identify Your Goals
Each family has its own dynamics and priorities—and blended families add another dimension that must be considered as you create or update your estate plan. Many factors will have an impact on your estate planning decisions, especially when you remarry and your new spouse has children, or if one of your adult children is in that situation. The decision about whether to provide for your stepchildren or step-grandchildren in your will or trust is an important and often emotionally difficult decision. The following factors are among those in play:
- Age. When you remarry, the ages of both you and your new spouse and the ages of your stepchildren often have an impact on estate planning decisions. If you and your new spouse are older and both financially independent, and all of your children are adults, it may make sense for each of you to leave your assets to your own natural heirs. However, if you and your new spouse are young adults, and your spouse’s children are quite young, it is more likely your new spouse and stepchildren will be dependent on you for financial support and that you will play a significant role in raising your stepchildren. In this case, you may decide to provide for your stepchildren in your estate plan to some extent or even in the same way you have for your own children. Grandparents are likely to weigh similar considerations in determining whether to include their step-grandchildren in their estate plan. Your decision will depend upon the unique situation of your blended family.
- Importance of bloodline. For some people, it is very important that their own children or grandchildren receive the bulk of their money and property. This may be the case even in situations where younger stepchildren are involved and their relationship with those children is strong.
- Relationship. Unfortunately, some people simply do not get along with their new spouse’s children or their step-grandchildren. Or, if the stepchildren are grown and live in a distant state or another country, there may not be much of a relationship at all. If this is the case, they may feel less inclined to provide for the stepchildren in their estate plan. In contrast, other individuals come to view their stepchildren with as much love and affection as they do their own children and may want to reflect this relationship in their estate plan.
- Heirlooms or other personal property. If one of your ancestors brought a special piece of furniture or jewelry from Ireland in the 1850s that has been passed down through the generations, you may want to ensure that it goes to your own children or grandchildren or to another blood relative when you pass away rather than to your new spouse and ultimately to your stepchildren. This may also be the case if you have items that belonged to a deceased spouse that are of sentimental value to your own children or other family members.
Implement Estate Planning Strategies
It is important to keep in mind that unless you have adopted your stepchildren, they generally have no legal right to inherit anything from you at your passing. Similarly, if you are a grandparent, your step-grandchildren will have no legal right to inherit from you if your child has not adopted them. If you want to leave money or property to them, you must specifically name them in your will or trust.
Nevertheless, if you remarry and leave all your money and property to your new spouse in your will, he or she is free to leave any remaining amounts to their children (and to leave nothing to your own children) at his or her death, even if that is against your wishes. Likewise, if you are a grandparent and leave money or property to your adult child, and that child dies before his or her new spouse, then the new spouse could receive any remaining amounts and is free to spend it or leave it to his or her own children. Your child’s spouse would not be under any obligation to leave the remaining money or property to your biological grandchildren.
If you would like to ensure that your stepchildren or step-grandchildren are treated in the way you intend, it is important to consult us so that we can design or update your estate plan in a way that reflects your wishes.
Will. You may want to provide for your stepchildren or step-grandchildren by naming them specifically in your will. However, if you die while they are still minors or too young to handle the inheritance responsibly, a will without a trust provision is unlikely to achieve the best results. Alternatively, you can also ensure that your stepchildren do not inherit from you, even if you have adopted them, by specifically excluding them by name in your will.
Trust. Trusts are often preferable to wills for blended families, as they allow you to exercise more control over what happens to your money and property after your death. If you have remarried, you can provide for your new spouse for his or her life and specify any amounts that you would like to give to your own children and your stepchildren, as well as how and when those amounts should be transferred to them. In addition, you can indicate certain purposes for which the trust funds should be used, for example, education, support, etc., and if you wish, you can specify different purposes for your own children and your stepchildren (or grandchildren and step-grandchildren). You can also exclude your stepchildren, or if you are a grandparent, your step-grandchildren, from receiving anything from the trust by not including them as beneficiaries of the trust. In addition, you can name a trustee that you are certain will be impartial, so that your own children and your step-children (or grandchildren and step-grandchildren) are less likely to have any grounds for alleging favoritism in the way the money and property in the trust are handled.
Personal property memorandum. Some states allow the use of a personal property memorandum, which is a list of specific personal property that and names the people you would like to receive each item. It typically must be mentioned in your will or trust in order to be valid. You can also include such a list in your will or trust, but those documents can be more difficult to amend if you later change your mind. Regardless of which estate planning tool you decide to use, it is especially important in a blended family to explicitly designate the person that should receive any family heirlooms or items having sentimental value.
Other planning tools. If you do not want to include your stepchildren or step-grandchildren in your will or trust, but would still like to provide a gift for them or acknowledge your relationship, there are other tools that you can use to achieve this goal, such as lifetime gifts or life insurance policy or retirement account beneficiary designations.
We Can Help Design a Successful Estate Plan for Your Blended Family
If your family is one of millions of blended families in our country today, we can help you create or amend your estate plan to ensure that your wishes for your stepchildren or step-grandchildren, as well as other family members, are carried out after you pass away. Please call us today to set up an appointment with our experienced Madison Estate Planning Attorneys so we can discuss your unique circumstances and goals and the best tools for accomplishing your wishes for your blended family.