The nature and face of the American family is changing, and has been for years. America is aging and divorce is common to the aging population. Divorce, being a single parent, and remarriage are all common. It is always a joy when people are able to move forward and remarry. Adding step-children can also be a wonderful time to help expand a family’s ability to love and grow. Although estate planning may not be the first thing you want to think of right after you have remarried, it is an important time to do so. Blended families have some unique estate planning considerations that you should think about.
First, if you have children from a prior relationship, it is essential that you have an up-to-date Last Will and Testament, and that you have a trust. Your Will needs to make specific provision for your children and your current spouse. Moreover, if you have step-children who you wish to provide for after your death, you need to make specific provisions for them, as well. Without a Will or a trust, your assets will be distributed according to the California laws of intestacy. Intestacy laws will distribute your assets according to a set of default rules. These rules will state exactly how much your wife receives and how much your children receive of your community and separate property. Especially in cases where your new spouse may have plentiful separate resources, you may wish to ensure that your children receive a different percentage than dictated by the law. Moreover, step-children do not automatically receive a share of your estate, so without a Will, a dearly-loved step-child may be left out in the cold.
Another important consideration is how you hold real property. If you purchase a home with your new spouse, it is likely that it will be titled as joint tenants. This means that upon your death, your interest will pass automatically to your spouse, and passes outside of probate. If you have children from another relationship, your children will not inherit a portion of the value of the real estate that automatically passes to your spouse. Most people hold a substantial amount of their assets in real estate, so if this is also true for you, you need to make sure to update your estate plan to make sure your children from another relationship do not miss out on a large chunk of your assets.
Finally, you should also consider your life insurance policies. Life insurance passes outside of probate. This means that your Will or even intestate laws do not impact how the proceeds are distributed. You need to revisit who is named on the beneficiary on your policy after you remarry to make sure that your new family is properly provided for.
We have extensive experience in helping all types of blended families create an estate plan that is right for their needs. Contact us today for a consultation.
