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Five Estate Planning Issues You Must Consider with a Second Marriage

June 6, 2017

Filed under: Blended Families — Neel Shah @ 9:15 am

Getting married for a second or third time is increasingly common in the United States. However, the complicated estate planning and financial issues can be anything but simple if you don’t schedule a consultation with an estate planning lawyer well in advance. There are many different issues that can emerge when it comes to blended families and second marriages. First of all, you may already have an estate plan in place from your previous marriage. There’s also a good chance that your former spouse was listed as a beneficiary on your retirement accounts and your life insurance policies.

If you fail to update this information, by law those companies are required to give it to the person listed on the accounts. estate planning for a second marriage

It is imperative that your estate plan be in conjunction with the other materials you have designed to pass on assets to people in the future such as your retirement accounts and life insurance policies. Some of the critical issues that you need to discuss with a knowledgeable estate planning attorney when getting married for a second time include:

  • Community property versus common law
  • Ownership and expenses
  • Timing of inheritance
  • Remarriage protection
  • Use of the home

Consulting with a lawyer will help illuminate you on the various issues that can affect you and how to plan appropriately so that everyone is clear on their rights and responsibilities.

Blended Families and Estate Planning: Looking Ahead

February 15, 2017

Filed under: Blended Families — Neel Shah @ 9:15 am

While estate planning is important for everyone, it’s extremely important if you have a blended family. One of the biggest reasons for this is that blended families are much more likely to have complicated issues and it’s a situation in which small mistakes can become big ones if you don’t plan ahead properly. It’s important to identify an attorney who has experience with handling these kinds of complex concerns in your family so that you have peace of mind that you’ve considered all options. 

More and more Americans are part of a blended family. This simply refers to a situation in which one or even both spouses are bringing in children from a prior marriage. It can be really complicated to approach estate planning in these situations in which the adult probably wants to care for their surviving spouse as well as children from the previous spouse. One way to do this is to consider using a trust. When opting for a trust, you have more say and control over how your assets are distributed. Setting up a meeting with an estate planning lawyer is strongly recommended if you’re thinking about using a trust.

It’s about more than putting together new documents, however. You’ll want to be equally concerned about updating documents you already have. Even the best of intentions and clear instructions in your estate planning documents can be overridden if the account in question is one where you need to name beneficiaries. For example, your IRA or your life insurance policy carriers will keep your instructions about who is to receive your assets. If you don’t also update these materials when you get remarried, the company will carry out the last valid instructions you left on your beneficiary forms. If you forget to update these, there’s a strong chance that your previous spouse could be legally entitled to receive some or all of those benefits.

Set aside a time to meet with your estate planning lawyer to talk about how your previous marriage and your new marriage warrant a review of your estate planning goals. Setting aside the time to talk to someone who understands the legal implications of these issues can be extremely helpful and give you some confidence that you’ve put together a plan that reflects your current needs.

 

Blended Family Estate Planning

December 5, 2016

Filed under: Blended Families — Neel Shah @ 9:15 am

Everyone can benefit from some type of estate planning, but this process becomes all the more important in the event that you’re blending families. The best time to handle this situation is now, before any of the necessary plans must be implemented. Estate planning is not always easy, but partnering with the right lawyer can make the process easier to manage. A knowledgeable lawyer can go a long way towards helping you figure out next steps.

One of the most important things to remember is to update beneficiary designations for accounts like your life insurance policy or your IRA. Even updating these details inside your estate plan doesn’t mean that it overrules what’s listed in your account paperwork- whatever your insurance company or IRA has on file will be the information referenced. If you have a child or former spouse listed as the beneficiary to your IRA, for example, then that individual will receive the assets if something happens to you. This means your current spouse may be ignored entirely. Getting remarried should prompt you to review all this material. 

Another good option for your estate planning purposes is to create a living trust. This can help your loved ones avoid the process of probate while also giving you more information about how your assets should be distributed. The trust could even give your surviving spouse income for the rest of his or her life if it’s structured properly.

A prenuptial agreement may be the final planning tool you can use in order to protect yourself with a blended family. Assets entering complicated blended family situations may need special planning opportunities that could be handled by an experienced estate planning lawyer in NJ.

Combining two different families is an exciting occasion, but it’s one that warrants insight from an experienced lawyer.

Estate Planning and Remarriage: Mistakes to Avoid, Part 2

April 15, 2015

Filed under: Blended Families — Tags: — Neel Shah @ 9:15 am

When you are getting married for the second or third time, there are important things you need to consider related to your estate planning. Since remarriage is only on the rise, prepare to avoid these common mistakes by working directly with an estate planning attorney.

Mistake #4: Not Updating the Will

A remarriage is a big life change and one that warrants an update in your will. You may need to include new family members like the spouse and his or her children in your will, so it’s worth a review. Along the same lines, make sure the language in your will is clear. When you make a reference to “my children”, what does that actually mean? Likewise, “my family” can be quite vague. shutterstock_132297164

Mistake #5: Not Factoring In the Feelings of All Family Members

It’s often overlooked just how much your family might care about your estate planning. This is especially true for children and stepchildren in blended families. Even if the relationship with all these individuals seems good now, that ca change in the future. Be open to reviewing your documents at least once a year.

You can avoid these common mistakes by setting up an appointment with an experienced estate planning attorney. Estate planning is not an activity that you can schedule once and forget- it’s an ongoing process that can be altered based on the changing needs of your life. Contact us at info@lawesq.net.

Newlywed Estate Planning

August 6, 2014

Filed under: Beneficiaries,Blended Families,Divorce,Estate Planning — Tags: , , , — Neel Shah @ 3:41 am

While there is a great deal to celebrate getting ready for your wedding, don’t neglect this excellent opportunity to delve into your estate planning as well. Unfortunately, as you may already know, accidents can happen at any time. Of course we all hope that nothing impacts your new family and celebrations, but it is critical that you discuss your plans with your new spouse and outline your plans early. Remember that it will be much easier to update them later on once you have decided on the proper documents, but that you should never neglect putting your plan together entirely.

Newlywed Estate Planning

Photo Credit: gogirlfinance.com

You can begin with small steps, like changing your account beneficiaries. This is one of the easiest things to do in your overall estate plan, but there are big ramifications if you’re adding on your new spouse. Do it early. Make sure you update your life insurance, IRA, and 401k accounts, including any others that may have beneficiaries listed in the event that something happens to you.

Your next step should be to look over any wills that both of you have and to ensure that each individual has a solid will reflecting his or her current wishes. Powers of attorney and medical directives are also crucial for new spouses who may be updating their information from the past to reflect their new marriage. For more ideas about transitioning your estate planning to married life, contact us through email at info@lawesq.net or contact us via phone at 732-521-9455 to get started.

Estate Planning Tips for the Blended Family

July 22, 2014

Filed under: Blended Families,Divorce,Estate Planning,Estate Planning for Children — Tags: , , , — Neel Shah @ 4:58 pm

Second or third marriages can be very fulfilling, but they also bring their own set of challenges when it comes to estate planning. There could be children from previous relationships and children that have been born into the new marriage. If both parties were previously divorced, this can complicate property and other assets that have been brought into the marriage.

Estate Planning Tips for the Blended Family
(Photo Credit: revealedintime.blogspot.com)

You want to approach this issue by thinking about your individual estate planning goals first. Your assets, like investments, retirement plans, brokerage accounts, jewelry, cars, and houses, should all be considered. If you have not recently updated your beneficiary designations, you will want to consider whether your goals have changed as a result of a new marriage. Frequently people forget to update the beneficiaries on these important accounts after getting remarried, so it’s important to schedule an annual review with your estate planning specialist so that your documents always reflect your most current goals.

If there are certain items that you want your children to receive, make sure that you clearly note these items in your estate planning documents. Leaving all of the property to the surviving spouse may not be the best approach because it doesn’t ensure that those children will actually receive those benefits. In many cases, it’s most appropriate to use trusts to provide for the spouse while making separate plans for the children to receive the property. To learn more about our special planning for blended families, reach out to us through email at info@lawesq.net or contact us via phone at 732-521-9455.

Special Planning for Second Marriages: Lessons Learned From Casey Kasem

May 27, 2014

Filed under: Blended Families,Family Limited Partnerships — Tags: , , , — Neel Shah @ 12:29 pm

The recent news hoopla over Casey Kasem illustrates an important lesson for planning your own estate: things may change when you throw a second marriage into the mix, calling for a re-evaluation of your plans. There are many things that should be addressed in estate planning where a second marriage has occurred. Doing so will help prevent problems and lay the groundwork for plans that actually carry out your wishes rather than spark legal battles among family members.

Special Planning for Second Marriages Lessons Learned From Casey Kasem
(Photo Credit: mediaconfidential.blogspot.com)

Medical directives, powers of attorney, and even decisions about burial planning should all be considered in your estate plan if you are involved in a second or third marriage. This avoids conflict between family members that can make the grieving process even more difficult.

When it comes to passing down assets, this is especially complex in a second marriage. Who should get the money? Should it be split between children? Does it go to the first wife in one lump sum and the remainder is split among the children? There’s a lot of tension that can arise if you don’t think about the answers to these questions well in advance. Conflicts tend to crop up especially when a non-parent spouse is receiving assets that children feel entitled to in one sense or another. The more clarity there is in your planning, the better. Once you’ve met with an estate planning professional, it’s important that you in some sense communicate what you have outlined to family member stakeholders. To learn more about estate planning techniques for second and third marriages, email us at info@lawesq.net or contact us via phone at 732-521-9455

“Here’s a Story…Of a Lovely Lady…” Planning for Today’s Blended Families

June 28, 2012

Filed under: Blended Families,Estate Planning — Neel Shah @ 6:10 pm

I grew up watching the Brady Bunch.  Mike and Carol Brady are my first recollection of the “Blended Family.”  Mike had three children from a previous marriage: Greg, Peter and Bobby (of course, they also had Tiger, the family dog.)  Carol had three daughters from her previous marriage:  Marsha, Jan and Cindy … the youngest one in curls.  Although the concept may have been very progressive & I found the show very entertaining, I have my doubts about how representative or realistic it is of Blended Families that exist today.

For example, wouldn’t it be more likely in today’s age that Mike’s and/or Carol’s divorces would have led to the creation of their new blended family (as opposed to them both being widowed?)  I suppose that the producers of the show felt that having Mike’s or Carol’s divorced spouse written into the show would have changed the dynamic (if so, I have to agree.)

Also, what if Mike and Carol had more children after they were married?  This new child would be the only common biological child to both parents.   How would that have affected the family?

A quick Google search revealed this as a definition for a Blended Family (from this Boston College website):

    “1. A family that is formed when separate families are united by marriage or other circumstance; a stepfamily. 

    2. Various kinship or nonkinship groups whose members reside together and assume traditional family roles” (Barker, 2003, p. 46).

“…has a role structure in which at least one parent has been previously married and which includes children from one or both of these marriages” (Johnson, 2000, p. 119).

My colleague, Jennifer L. Moccia, has written a wonderful blog post with some introductory thoughts on the topic, titled Estate Planning Considerations for Blended Families.  Ms. Moccia notes some of the issues surrounding these “nontraditional” families, including:

  • the fear that children from a prior relationship may not be provided for by the surviving spouse if the parent were to become disabled or pass away,
  • how the absence of an estate plan & a marital agreement may affect a child’s inheritance because of state law,
  • who would control the child’s inheritance in the case of a minor child, and
  • how to accomplish the parents desires to treat children equally or unequally.

You can read the entire blog post by clicking here.  I think the following quote from her post puts it best: “Successful blended family estate planning is a matter of setting and communicating goals, learning the available legal strategies, implement­ing the chosen documents and setting appropriate expectations for the client. With guidance from experienced counsel, the various goals of each family can be met by crafting and implementing estate plans that provide for each spouse and protect the interests of their respective children.”