Families come in many forms, and blended families are becoming increasingly common. Couples with children from previous relationships are creating new, loving and dynamic households.
But blended families face unique challenges when planning for the future. Without a clear, well-structured estate plan in place, your children, step-children or surviving spouse are financially vulnerable.
Why a will may not be enough
A majority of American adults don’t have a will. If that’s your current situation, it’s imperative to understand that Virginia’s intestacy laws state that your spouse gets one-third of your assets, while your children from a previous relationship get two-thirds.
However, just having a simple will can easily lead to problems in blended families. For example, the surviving spouse may inherit most of the deceased’s assets. Eventually, they may remarry or, for some reason, choose not to leave anything to their previous partner’s biological children.
Fortunately, there are estate planning tools available to ensure that everyone is protected. Additionally, your children will receive what you intend without having to rely on someone else to carry out your wishes later.
Trusts are incredibly versatile. Revocable living trusts allow you to specify when and how your children and spouse receive assets. For example, a marital trust can provide income for a surviving spouse while preserving assets for the decedent’s children from a previous relationship. Furthermore, assets placed in trusts don’t go through probate, so your loved ones don’t have to wait months for the funds to be distributed.
Beneficiary designations are another great estate planning tool. The proceeds from life insurance and retirement accounts can pass directly to specific children or step-children.
It’s crucial to discuss your estate plan with your blended family. Any surprises can cause tension and hurt feelings. Explaining your wishes clearly can reduce the chance of disputes or legal challenges later.
Working with a legal professional can help ensure your estate plan reflects your goals and complies with Virginia’s laws.