Many parents assume that their children will eventually inherit family assets simply because “that’s what we intended.” Unfortunately, second marriages often inspire estate planning problems that families don’t see coming.
Without careful planning, children from a first marriage may receive far less than expected — or nothing at all. Estate planning attorneys sometimes refer to this situation as the “second spouse trap.”
Wills may be too simple for a particular family’s needs
Married couples often create estate plans that leave everything outright to the surviving spouse. At first glance, this seems logical and loving. However, many of these documents fail to include remarriage protection provisions. After the first spouse dies, the surviving spouse may later remarry and completely change the vision of the initial estate plan. New spouses, stepchildren or outside influences can alter inheritance intentions dramatically. Even if the surviving spouse originally promised to “take care of the kids,” nothing may legally require them to preserve those assets for the children of the first marriage.
Joint ownership can be tricky
Tenancy by the entirety and similar forms of joint ownership can also inspire concerns. Many married couples hold homes, bank accounts and other assets jointly. Upon the death of one spouse, ownership transfers automatically to the surviving spouse outside the probate process. While convenient, this automatic transfer can unintentionally disinherit children. Once the surviving spouse becomes the sole owner, they generally gain full authority to sell, spend, gift or redirect those assets. Children may assume they will someday inherit the family home or savings, only to discover that the surviving spouse legally transferred everything elsewhere after remarrying.
There may be missing “bloodline” trusts
Failing to establish bloodline trusts is also a challenge for many families. These trusts are specifically designed to preserve assets for biological children regardless of future marriages, remarriages or outside pressures. Instead of transferring assets outright to a surviving spouse, certain property can remain protected inside a trust structure. A surviving spouse may still benefit financially from the trust during their lifetime, but the remaining assets ultimately pass to the children according to the original parent’s wishes.
At the end of the day, without bloodline protections, family wealth may unintentionally shift away from children and grandchildren over time. Assets may end up benefiting a second spouse’s family, new heirs or even unrelated individuals.