Life is unpredictable, and families often don’t turn out the exact way that people expect. A marriage that you thought would last forever could easily end in divorce. A spouse you loved could die while you are still well before retirement age.
Blended families, which involve a parent remarrying, are common. Often, each of the new spouses may have their own children that they bring to the relationship. Remarrying can provide companionship and also support in your home.
However, it can also complicate the relationship with your children. It’s important to think about the implications of your new marriage on the inheritance you want to leave for your children. You may need to update your estate plan when you remarry.
Trusts are a common solution for blended families
Spouses usually have the strongest inheritance rights out of anyone in your extended family. Even if you don’t create a last will that gives them almost everything, the state will certainly assign much of your property to your spouse if you die without a will.
If you want to protect certain assets for your children, adding a trust to your estate plan can be a good solution. An estate trust will make it easier for you to limit what assets certain people receive and the circumstances in which the trustee distributes those assets.
For example, moving your house into a trust could allow you to leave instructions for your spouse to continue living there for the rest of their life. However, instead of letting them inherit the house, you only allow them occupancy. The house that you paid for before your marriage can eventually pass to your children, who can sell it or move in when your spouse dies.
Formal protections are better than assumptions when it comes to your legacy
Leaving everything to your spouse and then allowing them to provide your children with an inheritance may seem like an easy solution until you realize that your spouse will have no obligation to pass anything on to your children.
They could leave everything you wanted your children to inherit to their biological children. They could spend or sell everything, leaving nothing for your children. They could even remarry, making their spouse the person who ultimately receives all of your property.
However much you may love and trust your new spouse, you don’t want your children’s inheritance to depend on their goodwill. Thinking carefully about the legacy you want to leave can help you make the right estate planning decisions.