Mixed Family Fun and Considerations
Yours, mine, and ours is more than just a cinematic send-up of blended families - it's a reality for many modern couples bringing kids from former marriages into new living situations. These days a normal family could consist of siblings, half-siblings, and step-siblings all living together, leaving parents to figure out how best to divvy up their estate when the time comes. Here are a couple of options for asset protection and division that modern, blended families should consider.
By Family Parentage
Throwing all the kids into one pot when it comes to inheritance might not be satisfactory to both partners in a marriage, especially if one came into the situation with more money. In addition, each party may be inclined to leave portions of the estate not only to their children, but also to ex-spouses, ex-step-children, and other associates from former unions. In this case, the best solution may be to start by separating assets going into the marriage. This allows each spouse to allocate their own money and assets through wills and family trusts pertaining to their own family, with the option to make changes should new family members, such as children, result from the new union.
Divvying up money and assets in a blended family is complex enough without figuring out percentages based on birth. Perhaps the easiest option, then, is to simply split everything equally among all family members, including spouses and children, regardless of which marriage they resulted from. This not only makes distribution of assets from a trust easy, but it's also likely to curb any hurt feelings and potential contests of a will or trust. This is, of course, assuming that the partners involved in the blended family stay together until one or both pass away, as opposed to divorcing and forming other unions.
Blending families and blending assets can quickly become complicated. It may therefore be easier to set up a trust containing all notable assets, whereby one spouse is the trustee during his/her lifetime, the other spouse inherits everything should the trustee die first, and from there the allocation of assets to children (and possibly grandchildren) can be decided. This tends to be the most common route when it comes to setting up wills and trusts for blended families, and it's certainly easier when it comes to creating a family home trust. Just make sure that assets that already have beneficiaries listed (retirement plans, life insurance policies, etc.) are amended to match the beneficiaries listed in a will or trust, as the beneficiary named on the policy will take precedence if the two don't match.
So why not learn more and register with TrustUs today.
After all, it's in your hands.