How To Set Up An Estate Plan For A Blended Family In California

In this article, you will discover:

• How to ensure your children will inherit without a dispute in a blended family.
• How to protect your spouse financially when estate planning for a blended family.
• Common mistakes parents with blended families should avoid when estate planning.

Unique Estate Planning Challenges For Blended Families

The concept of a blended family means both parents were previously in a relationship or married with children. Now, the parents are coming together in a new marriage and blending two families. 

Blended children are often older, don’t grow up together, and may not get along. Also, each child has another parent from the prior relationship or marriage in the mix. 

The biggest estate planning challenge is the implications for all blended family members when one parent dies first. 

How Can I Secure Children From A Previous Marriage Inherit Without Disputes?

To ensure children from a previous marriage can inherit without disputes, you must make specific provisions in the trust document. When one spouse dies, you either lock down half the trust or make the whole trust irrevocable. 

With the lock-down option, the remaining spouse or “survivor trustee” still has access to 50%, but not the whole trust. The remaining 50% goes to the children. With the irrevocable trust option, whatever provisions there were cannot be changed or revoked. 

Another option is to leave everything to your children. Typically, because most parties have a car, a house and some bank accounts, it’s hard to do that without displacing the remaining spouse. That’s why it’s essential to speak with your attorney about your goals. 

How Can I Protect My Spouse Financially While Ensuring My Biological Children Inherit Assets?

If you want to ensure you’re protecting your spouse but also want your children to inherit, you could, for instance, leave life insurance to your children and make sure your spouse inherits the house. 

If the house is owned by you separately, you could leave your spouse the home as a life estate, so the children can’t kick them out. This scenario is a typical worry when there’s a blended family. 

Attorney Diane Anderson is an experienced lawyer based in Jackson, CA, who has helped countless clients just like you navigate the intricacies of family law. With over 19 years of experience, she is prepared to assist you in creating an estate plan for your blended family so that all family members’ interests are protected.

Still have questions? Ready to get started? Contact the Law Offices of Diane Anderson today to schedule an initial consultation.

What Are Common Mistakes In Estate Planning For Blended Families?

The most common mistake is trusting the other party and not locking the trust down. Too often, one spouse dies, and the other spouse wants to change the trust to the detriment of the deceased spouse’s children. Parents don’t intend for their children to be removed from a trust. They want to leave something to their children as a legacy, and estate planning is all about preserving that legacy. 

For the most part, any time you have a conflict of interest in a blended family, it means that someone has already died. It is too late to make any changes to the estate plan once someone has passed, and at that point, nothing can threaten the estate plan. Anyone challenging the estate plan would have to do so in court, which is a difficult burden to prove. 

Can I Challenge A Successor Trustee Who Doesn’t Fulfill Their Duty?

The whole purpose of a trust is to avoid probate, which is one of its most significant benefits. Another essential feature of a trust is that if the successor trustee isn’t acting correctly, the beneficiaries can go to court to ask for help. 

When the trust creators pass away, the successor trustee’s job is to carry out a trust termination which simply means distributing the assets according to the trust. There’s no need for court, lengthy delays or surprises.

That said, if the trustee isn’t following the rules or if beneficiaries feel something is off, they can go to court. You may need a lawyer in those situations. Their fee is usually based on hourly rates or a small percentage of the estate’s value.

Ensuring Each Family Member Feels Heard And Respected

The only people whose wishes need to be heard are the two people creating the trust, typically the husband and wife. It could be a blended family. It could be two husbands or two wives. As an attorney, I ensure that I’m representing the two parties that are the trustees in the joint trust. 

The blended family members might object, but what their parents say is what matters. Every family member may have their own individual feelings, but the directive set apart by the person who created the trust is the ultimate decision at the end of the day.

Additionally, when I meet with clients to create their trust, I always tell them to be specific, intentional and honest about their family dynamics.

Maybe you’re concerned about one of your children due to a history of substance use, legal trouble, or financial instability. You need to put those concerns in writing. You can include conditions in the trust, such as requiring a beneficiary to be drug-free or not engaged in illegal activity in order to receive their inheritance. That language can be enforced by the trustee (often a sibling or other trusted person) who’s responsible for making those determinations.

Your trust can reflect every part of your life and your values. In the end, it comes down to this: your trust should speak for you when you’re no longer here. The more thought, clarity, and care you put into it now, the easier it will be for your loved ones later.

Still Have Questions? Ready To Get Started?

For more information on estate planning for blended families in California, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (209) 729-7477 today.