ESTATE PLANNING TOOLS AND SOLUTIONS FOR BLENDED FAMILIES

By Cory Howes

coryAs we discussed in a recent article, blended families have unique challenges with regard to estate planning versus more traditional family units. Proper estate planning can alleviate your concerns about your unique family situation, giving you the confidence and peace of mind that your wishes will be carried out. As we noted, not all families are alike, so you can’t rely on an off-the-shelf estate plan or make assumptions based on other families’ experiences.

Working with an experienced estate planning attorney avails your family to a variety of tools and solutions to make sure you take care of those whom you love.

Beneficiary Forms

Do you have a significant amount of wealth in your retirement accounts and life insurance policies? The beneficiary designation controls these assets—not your trust or will—so these designations need to be coordinated with your overall estate planning.

Think about your estate planning as a whole, as well as these separate accounts. For instance, you may wish to allow your estate to pass to your children while providing a death benefit through a life insurance plan for your surviving spouse. However, don’t name minors as beneficiaries, since they are not legally able to control assets. If you do, the court may appoint a guardian to manage the asset until the child turns 18. At the Forrest Firm, we can discuss strategies that will allow your spouse or children to receive benefits from your retirement account and life insurance policies without court intervention.

Advanced Healthcare Directives

Healthcare directives, including a healthcare power of attorney and living will, give you the opportunity to name a trusted family member to make decisions about your health care if you are unable to make those decisions for yourself, and state your wishes for end-of-life medical care. Keeping your health care directives updated is always helpful for your physicians and other medical professionals in the event of an emergency. This is also a chance to discuss your feelings about burial arrangements, organ donation, and end-of-life care with your new spouse.

Power of Attorney for Financial Affairs

Similar to a healthcare power of attorney, a general durable power of attorney gives you the opportunity to name a trusted family member to manage your legal decisions and financial affairs should you not be able to do so. If you have already named a power of attorney, including a previous spouse, make sure that you revoke him or her before naming your children, new spouse or another trusted individual as your agent. It’s also a good idea to keep your power of attorney “fresh” by renewing it every so often since powers of attorney that are older than a year or two might not be accepted by a bank or third party when needed.

Trusts

Trusts are probably the most flexible estate planning tool available to families. If you haven’t had your trust reviewed in the last four years, it’s probably worth a review. If it’s been longer than 10 years, your trust almost certainly needs a complete overhaul, because there have been so many changes in laws over the last decade.

It might make sense to create a trust that benefits your spouse during his or her life while ensuring that those assets ultimately end up with the beneficiaries you choose. Additionally, you may want your children to receive your separate property (like a family heirloom or ancestral lands) at your death while other property remains in the trust until your surviving spouse passes, at which time whatever is left will go to your children.

Every family, blended or otherwise, presents its own set of challenges, both personal and legal. We can guide you and your loved ones through the process, discuss your wishes, and help you effectively plan for the future. Call us today to discuss estate planning for your family, and we will be more than happy to answer any questions or concerns you might have.

Please feel free to email me to get started.