People who divorce, remarry, and create blended families often create inheritance disasters because they never updated their Wills, Trusts, Powers of Attorney with an expert. If you have a blended family, how will you avoid creating an inheritance disaster when you die?
In this legal webinar about estate planning for blended families, we’ll talk about:
Different types of property like:
- Community property: Any property real or personal, or debt acquired during the marriage.
- Separate property: Property acquired prior to marriage, after the date of separation, or during marriage by inheritance or gift.
- Commingled assets: It’s complicated.
Asset protection and how to distribute assets like:
- Life insurance – You can leave assets to one beneficiary and leave your life insurance to another.
- Specific assets – You can bequeath certain assets like cars, land, art, etc. to certain people.
- A gift off the top – Adding a “Pay on Death” designation to certain bank accounts, held outside his Living Trust, is a simple way to ensure some heirs get a little cash immediately.
- Retirement funds — Like life insurance, you can leave your 401K(s) to one beneficiary, and the rest of your assets to someone else.
Retirement Planning in Blended Families – Retirement planning in any family is complicated, but in blended families, it’s a whole different ball of wax. As we touched on above, retirement funds are often automatically rolled over to a person’s spouse upon death, which means that spouse has complete control over those funds.
IRAs and the Secure Act – For most of our clients, an IRA is the biggest asset they’ll ever have—bigger, often, than even real estate. Because of the way IRAs work, when a person passes, it’s usually all still there, which is why it’s so crucial to talk about who inherits these funds when you die, especially in blended families.
Choosing your Trustee as a Blended Family – Most of us think of trustees as people who handle our affairs after we’ve died, but in fact, trustees step in as soon as you are incapacitated. Sometimes, depending on your Powers of Attorney, that person is not only making decisions about your money, but about your health and care. Usually, this person is a spouse, but in blended families, you may choose different people for different purposes, and again, that’s where things get complicated.
We’ll also discuss what happens when you don’t plan–essentially, you could end up in probate. Probate is essentially what happens when a court takes over to decide how a deceased person’s assets should be distributed. It’s a long, incredibly costly process that often results in fighting between relatives, especially in a blended family.
Although estate planning for blended families may seem daunting, with a little help and a lot of expertise, the right attorney can help you meet all your goals and leave the legacy that’s right for you.
Here at CunninghamLegal we have vast experience in these realms and attorneys who specialize in exactly these complex situations. We invite you to contact us and learn more. Trust us, you don’t want your heirs to have to deal with Probate. To avoid probate, you need an expertly-written Estate Plan which includes a complex Living Trust.