Issue 1: Your Will
Many people with blended families want to create an estate plan which names each spouse as the inheritor of the others property if one should die. After that, the couple often wants to make sure their individual children will receive an inheritance. However, it’s not that simple. A will is not a contract, and once someone inherits property, he or she is the legal owner and is free to use it as he or she sees fit. This means that if you leave all your property to your spouse, your children will only inherit property if your spouse chooses to leave them an inheritance.
Issue 2: A trust
Couples with blended families often choose to create one or more trusts in order to provide inheritances to their individual children. A trust can pass property to your children just like a will, but can also hold onto it for them if they are not old enough to legally own property. Trusts also allow you greater flexibility in choosing when and how the child inherits property.
Issue 3. Divorce
If either you or your spouse have been previously divorced, the chances that your current marriage will end in divorce is significantly higher. Planning for inheritance issues without taking the potential of a subsequent divorce into account can be a big mistake. Apart from individual plans, each spouse may want to find his or her own attorney to help develop a plan that adequately protects the spouse’s interests in ensuring their children receive an inheritance.
- Estate Planning is Essential Whether You Are Married or Not - April 25, 2018
- Income Tax Basis in Estate Planning – Part 2 - April 23, 2018
- The Downsizing Generation: How to Handle a Surplus of Stuff When a Loved One Ages - April 18, 2018
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