Blended Family Estate Planning: Strategies to Keep Everyone Included

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Emoji Style Blended Family showing coins and money representing planning between conflict

Estate Planning for Blended Families: How to Keep Everyone in the Game

Sep 11, 2024
blended families estate planning

When it comes to estate planning, blended families can feel like playing a complex, multi-level game with hidden challenges. With so many players involved — from stepchildren to spouses and even ex-spouses — it's easy for things to get complicated. But don’t worry, with the right strategy, you can win this level!

 

Let’s dive into some key moves that can help you navigate estate planning for your blended family and keep everyone happy, even after you're gone.

 

First, What is a Blended Family?

Blended families are like bonus levels in life, bringing together children from different relationships and creating a new dynamic. These families can come in all forms, including:

  • A divorcee with children marrying another divorcee with children
  • Someone with children marrying someone without children
  • A widower with children who remarries and creates a new family unit

 

No matter the mix, making sure everyone is provided for requires careful planning and consideration.

 

Common Issues in Blended Family Estate Planning

One common problem is leaving some players behind when distributing your assets. This can happen if there’s not enough in your estate to go around, or if your Will’s instructions don’t go according to plan.

 

For example, say you pass away and leave behind your spouse, step-children, and children from a previous marriage. You may have agreed with your spouse that after one of you dies, your assets would go to the other, and then be passed down to all the children. But things don’t always go smoothly. Relationships can shift, and without you around, there’s a chance your spouse may alter the plan and write your children out of the Will.

 

Mutual Wills: A Shared Strategy to Protect Your Family

One way to avoid these types of issues is by creating mutual Wills. Think of this as a binding co-op agreement where both partners commit to following the same plan. If drafted correctly, mutual Wills can prevent the surviving spouse from changing the terms and cutting anyone out of the game.

 

But remember:

  • Mutual Wills must be more than just similar documents; they need to be legally binding agreements between you and your spouse.
  • Regularly review your Wills to make sure they reflect both of your wishes. If changes are needed, both parties must agree, and the changes should be formalized by a lawyer.
  • Get legal advice to ensure the Wills are rock solid and avoid any future disputes.

 

Using Life Interest to Provide for Everyone

Another strategy is relying on a life interest

This article provides general educational information only. The content does not take into account your personal objectives, financial situation, or needs. You should consider taking financial advice tailored to your personal circumstances. Life Sumo (Orion Enterprises (Cairns) Pty Ltd) has representatives that are authorised to provide personal financial advice. If you would like personalised advice - please click here to talk with our team.

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