Blended Families and Estate Planning

Blended Families and Estate Planning

I’m often asked about the many situations that arise related to estate blended families and estate planning. The number of different scenarios and needs that present themselves is almost innumerable. Clients describe their situation and then pose the question, “What should we do?” While I can’t tell them what to do, I can share whatever legal principles apply and a few thoughts about what others have done.

I think you’ll benefit from this small sample of questions and situations I sometimes field. The names, of course, will be fictitious.

QUESTION: Does Power of Attorney have to be given to only one person in a blended family?

ANSWER: No. More than one person can be given Power of Attorney. It might, in fact, be preferable in your situation.

Here’s what one family did. George is a widower and a successful business owner with one son, Jeff. Later in life he married Janna, a widow with two daughters. One of her daughters, Emily, is a highly respected nurse.

Although the family was blended later in life, they quickly developed close, respectful relationships all around. Because of Jeff’s business and finance experience, he was given Financial Power of Attorney for both George and Janna. Emily, because of her medical expertise, was given Medical Power of attorney, also for both.

George and Janna felt that trust and expertise were both important in their decision regarding Powers of Attorney. Several years later, when consulting with them on another matter, they expressed great satisfaction with their choices.

QUESTION:  In a situation of divorce and remarriage, do Estate Planning documents have to be reworked?

ANSWER:  No, but it’s often helpful. Sometimes it’s very important.

Here’s what Sam and his family did. Sam had been divorced for several years when he married Diane. Sam had two daughters. Diane, who was much younger, had one young son. Sam and Diane then had a daughter, Lisa, a child with special needs.

Sam, Diane and the kids had several family meetings about their future, Lisa’s future, and how to make sure she was taken care of, no matter how life unfolded. The decision was made to have their estate planning documents reworked to secure care for Lisa, regardless of the circumstances.

QUESTION:  Does an estate have to be evenly split in a blended family?

ANSWER:  It can be if you want, but no. There’s no legal requirement. It’s not at all uncommon for an estate to be unevenly divided, both in general and in the specifics.

Here’s what Paula did in her blended family.

Paula had never been married, but had two children early in life. She worked very hard and was several years into a successful career. By the time she married Mitch, she’d bought a nice home in a popular neighborhood. Mitch, a father of three, was also successful in his own right. But he had gone through a nasty divorce and lost his home.

Mitch and Paula had no plans for more children. They agreed that the general value of their estate would be evenly divided. They specified, however, that Paula’s home would be left to her two kids. A few other items were listed as being earmarked for certain kids. Mitch’s watch, for example, will go to his oldest son. Paula’s youngest daughter will get the teddy bear collection.

Estate planning isn’t always forever done.

One of the most important things to know about Estate Planning is that it’s not always forever done. Situations change in life that sometimes warrant an update in your documents. Ay time there’s a significant change In your situation, take the occasion to review things with a qualified attorney who specializes in Estate Planning.

Marriage, children, the establishment of a business and retirement are all examples of a good time to review your documents. They very well may be fine, but it never hurts to verify that things are set up to meet your needs in light of your current situation.

2018-11-22T15:33:16+00:00