Relationships can be complex in any situation, and bringing together two families with children is rarely easy.
When a family becomes blended, it means dealing with your own family relations while introducing new parenting dynamics, and a whole new group of siblings. Even if the families blend seamlessly, there are still legal considerations that must be taken into account. At times, new children are also born and all of these things require special consideration.
How do things work when you’re dealing with inheritances and assets? Do you have a plan for estate planning for your blended family in Texas? Here’s how to make sure your estate planning is up to date and covers all of the bases.
What is Estate Planning?
Estate planning isn’t just for the rich.
Estate planning is actually very important, especially if you’re part of a blended family. Dying without a will can be devastating to your surviving family, and believe it or not, you do have an estate. Your bank accounts, investment accounts, vehicles, property, and other assets are all included in your estate.
Creating an estate plan with an estate planning attorney will ensure that your affairs are put in order in the event of your death or incapacitation with a revocable trust, or through other designations. These trusts ensure your loved ones are taken care of and can grieve their loss.
It’s never too early (or too late) to think about what you want to pass on to your next of kin should you pass away. To ensure that your wishes are carried out, it’s necessary to provide instructions on who you want to receive something, when, and what they are supposed to do.
Estate planning consists of a plan in advance, naming the people or organizations to receive your things after you die, and taking steps to make carrying out these plans as easy as possible. However, good estate planning is characterized by careful and well-thought-out considerations.
Estate planning should also include:
- Instructions for your finances and care if you become incapacitated
- Provisions should you become unable to work and require long-term care or provide for your family
- Designation of a guardian for your children
- Establishing a trust for any family members who are unable to handle finances
- Planning for taxes and other costs
Estate planning is a continuous process and your plan should be reviewed and updated as your family, finances, and applicable laws change throughout your lifetime. Making sure to keep up with these changes is essential in preparing for future responsibilities.
How is Estate Planning For Blended Families Different?
A blended family comprises people who had children from a previous relationship or marriage. Families today are looking pretty different, with some including stepchildren or half-siblings. These blended families can involve relatives living in the same home and other configurations. 113.6 million Americans are part of one of these ‘blended’ family structures.
Estate planning can sometimes be a challenge for blended families because it can make for awkward conversation. However, it is crucial to consider that many people have only a simple or DYI will. Unfortunately, a simple will is inadequate to protect children from previous marriages and, sometimes, the surviving spouse.
Here is one reason why you should consider estate planning in blended families, and how simple wills are inadequate to protect children from previous marriages:
Jack and Jill come into a marriage with two children, each from previous relationships. Jack and Jill have simple wills that state that the entire estate is given to the surviving spouse, with contingent gifts to each of the children.
In other words, the children will receive the estate if there is no surviving spouse when the benefits are to be paid. After Jill dies, Joe moves closer to his two children and becomes estranged from Jill’s children. He subsequently changes his will to give his entire estate to his children, leaving Jill’s children with nothing.
Estate planning for blended families often includes both a will and a trust, providing for all family members, and ensuring that no one is left behind.
Blended Family Estate Planning Options
Blended families often face several complex estate planning challenges. Issues can arise between spouses and between children and their spouses. People in blended families typically want to provide for their new spouse and their children from a previous marriage. They may also desire to provide for the children from their spouse’s prior marriage.
One of the most important things you can do to plan for your future is to make an estate plan with an estate planning attorney. Believe it or not, some people still wonder if they even need a will today. The answer is yes, but estate planning is more comprehensive than just a will.
Work with an experienced lawyer who understands estate planning options for blended families, as you can choose what works best for your situation.
- Marital trust: A marital trust allows your assets to pass directly to the surviving spouse after the first deceased spouse is gone. It can help provide income or assets to the surviving spouse and heirs.
- Family trust: With a family trust, all assets are added to the trust right after a spouse dies. This can be useful to make sure each of your children is provided for according to their specific needs.
- Immediate bequests: A bequest is a gift of assets left to someone, often a family member, after death through a will or trust.
How Do You Structure A Will In A Blended Family?
The more complicated your family tree, the more likely you’ll need professional help when it comes to wills. The basic premise of a will is that it’s a document that states how you want your assets divided among your heirs after your death.
How Does Inheritance Work In Blended Families?
In blended families, there are two types of inheritance: the type granted by the will of the deceased and the type granted by state law. For an estate to be divided, its assets must first be accessed and valued to determine how they are distributed.
If a will exists, it will usually state who is entitled to what property and should also have provisions for any beneficiary.
Why Is Estate Planning More Important For Blended Families?
Estate planning is important for everyone, but it’s significant for blended families. The reason is that when you are part of a blended family, your estate plan needs to be tailored to accommodate your family’s unique composition and needs.
How Does Inheritance Work For Stepchildren?
In Texas, one’s stepchild is not automatically considered an heir, meaning they will not inherit from their parent’s estate unless they are specifically named in the will.
What is a Trust in Estate Planning?
A trust is a legal arrangement that allows you to set up your assets to be held and managed by a third party, known as a trustee. Their responsibility spares your estate from any unnecessary worry of negligence.
Trusts are not just for large estates and the very wealthy. A trust is crucial for estate planning. It can protect your family, help them avoid probate court proceedings, and increase your control over the wealth you leave behind when you die.
The type and purpose of a trust will depend on your personal needs and goals. There is no one-size-fits-all option, so it’s important to take some time, think about what you want, and then seek legal advice. See this post to better understand the different types of trusts.
Do You Need a New Estate Plan to Include Your Surviving Spouse After Remarriage?
When you remarry, you may want to revisit your estate plan.
It’s vital if children are involved, as they may be significantly impacted by property and inheritance rights division. It also allows you to choose the people and organizations that will provide for your beneficiaries if something happens to you.
Sometimes, people change their minds about their current estate plan and need to undo certain documents made with a former spouse. Creating or reviewing your estate plan to include modifications to your will or any trusts will ensure that everyone you care for is accounted for in the event of your death.
Estate Planning Accounts for Your Children
When navigating estate planning for a blended family, it’s important to be thorough and cover all the bases. It would help if you spent some time talking with your spouse and their ex to make sure they will be able to provide care for all of your children or any charitable planning you may have. After you pass away, there are many ways to provide for your children financially, including a stepchild or any biological children.
Every family must have sound estate planning in place. When families are blended, it can be easy to overlook the need for proper legal planning since there are often two sets of wills and trusts that need to be coordinated and beneficiary designation that needs to account for your family and loved ones.
Without a legal document in place, it is possible for a particular family member’s assets to fall into the wrong hands or fail to be distributed to each loved one as the person intended.
We serve families of all kinds, helping and guiding them through these difficult decisions. Our professional attorneys will help you identify the best way to plan for your future. Contact us today to get started.