Divorce and remarriage are common occurrences in our society. As a result, there are many “blended families” in the United States, and Minnesota is no exception. Anyone in a blended family can tell you that while starting a new family and a new life is exciting, blended families come with their own set of special circumstances as everyone tries to adjust to the new family dynamics. In addition to adjusting to the present day-to-day life, blended families also present special issues for estate planning.
The most common issue that can be addressed through estate planning for a blended family is designating how the kids will be provided for in the event of the death of a parent. For example, if a husband has a child from a previous relationship and then passes away without a will, all of his assets would pass to his new wife. This would mean that his child could be left with no additional means of financial support from him, potential compromising the child’s livelihood. In creating an estate plan, a person can specify how a child will be provided for in the event of the parent’s death.
Additionally, many people want to be sure their adult children are protected even after they are married to a new spouse. Without an estate plan, a person’s spouse would inherit all their assets, and the adult children would be passed over. Proper estate planning allows a person to leave assets to adult children and to their new spouse.
The challenge for blended families is to make sure that both the children from a prior relationship as well as the new spouse are all taken care of in the event of a parent’s death. One way to accomplish this is through a revocable trust. With this instrument, a parent can provide assets in a trust in order to benefit the new spouse during his or her life, and then the corpus of the trust can be distributed to the surviving children. Trusts can also be set up to make sure that the children do not inherit their share of the estate until they have reached a certain age, or that the proceeds from the trust be used only for certain expenses, such as education.
If you have a blended family, you need to make sure that your estate plan is carefully constructed. Contact us today at (320) 299-4249 to talk about your family and how we can help you meet your goals.