These days, the nuclear family is no longer the primary family unit. Instead, the blended family is the new modern family. The term "blended" is used to describe parents that have already been married and may have children from that marriage before divorcing, but have gotten remarried and created a family there as well. This means that you might not just have a spouse and children as part of your family, but also stepchildren, ex-spouses, even step-grandchildren.
Blended families must plan their estates in a way that allows every member of the family to feel valued. Often, we have seen cases when a parent wants their current spouse and their children to be cared for, but also desires for children from a previous marriage to be cared for too.
Step 1: Set Up a Trust to Provide for All Beneficiaries
If a blended family does estate planning like a nuclear family - where all assets are left to a living spouse - then this poses great conflicts for all those involved.
The major worry is that your living spouse wouldn't pass that inheritance on to your children from a previous marriage, but instead would only provide only for their children.
One of the best ways to prevent this is to put your estate into a trust. By placing your assets into a trust, the funds within can help provide for your living spouse during her lifetime.
Then after that spouse passes away, everything within that trust will then be passed on to all your children throughout all marriages.
Step 2: Give An Inheritance through Retirement Accounts and Life Insurance
You may choose to leave the bulk of your estate safe in a trust for your spouse, but also you can take out life insurance or create retirement accounts with specific children as beneficiaries.
If beneficiaries are listed, retirement accounts and life insurance aren't passed through wills and are considered non-probate assets. They pass directly to the beneficiaries after one passes.
Step 3: Make Sure Everyone Knows What You Want
Preventing fights with your blended family after you are gone is likely one of your desires. It may be wise to round them all up in a room and explain what you are doing. That way, everyone is everyone's witness to your wishes.
This is particularly important after you have created a living will the dictates what you want if you become ill and unable to make your own medical decisions. You will want to put the most level-headed person in charge of ultimately making the decision, but you also want everyone to know you have do not resuscitate order in place or you don't want to be kept alive purely on a feeding tube and a respirator.
What if You Do Nothing?
Estate planning is complicated and often an item on our to do list that we postpone for later. So what would happen if you do nothing?
If you die without a will or trust in place, Ohio intestacy laws will pass your property through the law of descent and distribution. Choosing to not have a will is choosing to let the state make the decision as to where your property goes. If your spouse at the time of dying is not the parent of all your children, she will split the proceeds with children from other relationships if the amount is over a certain limit.
This would likely mean your current spouse and any children that are blood-related to you would receive inheritance. Stepchildren are left out of the inheritance if there is no will or trust in existence naming them as beneficiaries.
The real advantage to estate planning is that you can choose how your assets are divided. If you want to give your natural-born children, stepchildren, your spouse, and maybe even your ex-wife an inheritance, you can accomplish this with a good estate plan.
If you are enjoying the blended family life and are considering creating an estate plan to get ready for the future, contact us today.