Estate Planning Considerations for Blended Families
People in blended families have a lot of practice handling situations that might seem complicated or awkward to an outsider. Scheduling birthdays, holidays and school events are sometimes a challenge when parents remarry, but with some advance preparation, a satisfactory solution can usually be found. Estate planning can also be more complicated for individuals in blended families, and in these cases, personalized guidance from a qualified attorney is often the key to a successful resolution.
Without a comprehensive estate plan, disagreements among loved ones and unintended disinheritance are real possibilities. To put a program in place that reflects your wishes and minimizes the likelihood of a probate dispute, you might want to consider taking these steps:
- Clearly communicate your intentions — No family gets along perfectly, and after a breakup, there might be lingering hard feelings involving parents, children from different relationships, stepchildren, current and former spouses. Though some conversations could be tough, honest communication can avert emotional conflict and possible litigation after you’re gone.
- Update beneficiary designations — Many people forget to update beneficiary designations on life insurance policies, retirement accounts or payable-on-death accounts after remarriage. In blended families, this oversight can lead to unintended beneficiaries—such as an ex-spouse—receiving assets.
- Consider establishing one or more trusts — Trusts are invaluable tools for blended families because they allow the grantor to exercise greater control over asset distribution. For example, a qualified terminable interest property (QTIP) trust can provide income to a surviving spouse while preserving the principal for children from a prior marriage.
- Choose your executor and/or trustee wisely — When a decedent is leaving assets to family members from different relationships, there’s a high possibility of resentment or suspicion between the groups. When selecting an executor and/or a trustee, it could be best to find someone who is not connected to either side in order to quell allegations of bias.
- Remember the elective share — A spouse who is living with their husband or wife at the time of their death is entitled to one-third of their estate under New Jersey’s elective share law.
Blended families face unique challenges when it comes to estate planning, but at The Paton Law Firm LLC in Fair Lawn, I help North Jersey clients identify and implement solutions that fit their circumstances and priorities. Please call 201-470-4801 or contact me online for a free initial consultation.
