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Blended families can be wonderful, but relationships between family members can be complicated and nuanced – often more so than in more traditional families where both spouses are the legal parents of their children. When it comes to estate planning, those nuances matter.
It’s important to understand that the same legacy planning strategies and tools that may work well for people in “traditional” families may not work as well for people who want to plan to take care of both their current spouse and their children and/or grandchildren from previous relationships.
If you and your spouse have joined households and families and want to create or update your estate plans, keep these tips in mind:
You May Need a Trust (or Trusts)
Simple Wills are great tools in many situations, however planning for blended families usually isn’t one of them. With a Trust, or even reciprocal Trusts, you can ensure funds are available for your spouse’s support and needs if you die first, while also protecting assets for your children or other heirs. Trusts can provide valuable peace of mind for both you and your spouse, as well as for your respective heirs.
Consider Your Beneficiary Designations
Another popular strategy is to intentionally leave certain assets to your children or other heirs right away at your death, whether or not your spouse survives you. Of course, when taking this approach, you’ll want to ensure your spouse will have sufficient assets to meet his or her needs.
Be Deliberate About Your Choice of Trustee
In blended families, the traditional approach of naming a spouse as trustee or naming an adult child as trustee may cause inadvertent and unwelcome friction down the road. Consider naming a trust company or other professional fiduciary who can administer your trust and estate impartially.
Ready to start the conversation and create your estate plan? To learn more about these and other tips for blended families, contact us today!