When a person decides to make an estate plan, they may want to ensure their surviving spouse and children receive a legacy from their estate. When the surviving spouse is not the biological or adoptive parent of the children, estate planning requires a different approach.
Blended families offer people the chance to create a beautiful life together but may create challenges if an estate plan does not properly plan for all parties.
Wills and trusts
In nuclear families, a person may allow assets to flow to their surviving spouse, knowing that the remaining assets will likely flow to their joint children when that spouse dies. However, Forbes explains that with a blended family, this flow of assets may not be guaranteed as a surviving spouse may make other decisions with what they inherit.
Some trusts allow a person to provide an income for their surviving spouse for the duration of their life while retaining the primary assets for their children after the spouse dies. These trusts may benefit remarried couples with kids from one or both spouses.
CNBC notes that assets with beneficiary designations should be carefully reviewed when making or updating an estate plan for a remarried person. These assets offer them the ability to provide an inheritance to their children or grandchildren immediately upon their death while retaining other assets for their surviving spouse.
The trustee appointment
When establishing a trust, the selection of a trustee matters greatly. This person should be capable of addressing any potential issues or conflicts between heirs as well as managing the financial matters as outlined in the trust.