3 Estate Challenges for Blended Families

Preparing your estate can be complicated, and if you're a part of a blendedfamily, estate decisions can be even more complex and nuanced. Blended familiestake on many forms but typically consist of couples with children from previousrelationships. Here are a few case studies to help illustrate some of thechallenges.

Case Study #1:Children From Previous Marriages

Simple wills often are structured to leave all assets to the survivingspouse. If your estate strategy relies on this type of will, you could riskoverlooking children from previous marriages. Also, while it's unsettling toconsider, the surviving spouse can end up changing a will without propermeasures put in place.¹

When new children join a blended family, estate strategies can get even morecomplicated. But with a well-structured approach, you can direct how todistribute your assets.

Case Study #2: WhenOne Partner Has Significantly More Assets

While the divorce rate has been trending lower, the number of remarriages(2nd or more marriages) has increased. One person entering into a new marriagemay have more assets than their spouse, given that 40% of all new marriages areremarriages for one or both spouses. An estate strategy can help ensure thatyour assets pass down according to your wishes.²

Case Study #3:Traditional Trusts May Not Be Enough

In blended families, a traditional trust is a good start, but it may not gofar enough. One possible solution is to create three trusts (one for eachspouse, in addition to a joint trust) to help address different scenarios.³

Using a trust involves a complex set of tax rules and regulations. Beforemoving forward with a trust, consider working with a professional familiar withthe rules and regulations.

Starting theProcess

Blended families are pretty common these days. If you're in that position,it's important to remember that you can create an estate strategy to addressyour specific situation. The first step may be an estate document review.

1. Investopedia.com, April 30, 2023
2. Forbes.com, August 8, 2023
3. Investopedia.com, March 31, 2023

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