A blended family is a family that forms when two people marry or cohabit with children from their previous relationship. Blended families are sometimes called “step-families,” and they are an exceedingly and increasingly common component of American domestic life.
Although blended families are often indistinguishable from others, providing for a spouse, children, and step-kids isn’t always easy—especially when there’s the possibility of disagreement during probate or estate administration. Read more to learn about what you can to do protect your legacy, or contact Ross & Shoalmire to speak to an Estate Planning Lawyer and schedule your initial consultation.
Estate Planning Challenges for Blended Families
Blended families often face a wide variety of unconventional and unexpected estate planning challenges. This is due, in part, to the way that legislators write laws on probate and inheritance—laws that protect certain relatives, but could lead to others being disinherited if not properly accommodated within a will or trust.
Some of the biggest challenges for blended families include, but are not limited to, the following:
Probate
In Texas and Arkansas, probate is the intensive and court-monitored process of resolving a deceased person’s final affairs. It usually involves:
- Verifying the decedent’s will, if any will exists
- Paying the estate’s creditors
- Resolving lawsuits and other probate contests
- Distributing inheritances to heirs and estate beneficiaries
Probate almost always carries some risk, especially if the deceased person had any unpaid debt or didn’t create their estate plan with the assistance of an experienced estate planning lawyer.
Probate for blended families can be even more challenging if and when the surviving parent, children, and step-children can’t see eye-to-eye on the terms of their inheritance. Lawsuits are common; even when they fail, their defense must be funded with estate assets, meaning there could be less left for the estate’s rightful heirs.
Unpredictability
Life’s full of surprises, some of which are good and some of which are anything but pleasant.
Your estate plan needs to anticipate life’s most unexpected surprises. These could include:
- The possibility that you divorce your spouse
- The possibility that your spouse dies before you do
- The possibility that one of your children marries or divorces
Although you can’t write a will or establish a trust that accounts for every possibility, creating an estate plan that is clear, unambiguous, and realistic can drastically lower the chances of conflict during probate.
Different Children from Different Marriages
Blended families are especially vulnerable to estate challenges. Ideally, your plan should contain distinct provisions for:
- Your spouse
- Your biological children, who could lose out on their inheritance if you leave everything to your surviving spouse
- Your stepchildren, who may not be entitled to receive anything at all if you die intestate
Texas and Arkansas have complex succession laws. If you leave everything to your surviving spouse, but your spouse never created their own estate plan, there’s a chance that your biological children could be inadvertently disinherited.
Pretermission Statutes
Most states have “pretermitted child” statutes.
In simple terms, a pretermitted statute is a law that protects biological children from accidental disinheritance. If you leave a child out of your will but do include specific language, they may be able to argue that they were omitted because you never updated your estate plan after they were born.
Texas’s Community Property Law
Texas is a community property state, which means that each spouse jointly owns most assets and property acquired in the course of a marriage. Some assets, like any inheritance you receive from your own relatives, are excluded from community property. But others aren’t—even if the “other” asset is a home that you wanted to go to a specific child or stepchild.
Even if your spouse is committed to honoring the terms of your will or trust, community property laws and related entitlements can make succession painful for blended families.
Estate Planning Tactics for Blended Families in Texas and Arkansas
You don’t have to accept uncertainty in place of strong solutions.
Ross & Shoalmire have spent years helping families across Texas and Arkansas protect their peace of mind. Here’s how we could help you preserve your legacy:
Write or Revise Your Last Will and Testament
Your last will and testament is a set of instructions for how your estate should be formally dissolved and redistributed. By creating a will, you can:
- Name heirs
- Designate beneficiaries for certain assets
- Nominate a guardian for your minor children
- Include specific language to disinherit a biological child or other natural heir
Wills can be deceptively simple documents. Many websites offer free templates, but these templates do not usually account for state-specific laws and unique family situations. Any omission or oversight—no matter how slight—could cause expensive and time-consuming problems during probate.
Review Your Beneficiary Designations
A beneficiary designation lets you transfer certain assets directly to a named beneficiary without putting the asset through probate. Beneficiary designations, like “pay-on-death” provisions, are common on:
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Bank accounts
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Retirement savings accounts
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Life insurance policies
Beneficiary designations need to be reviewed, streamlined and tracked. Since they are not subject to probate, they take precedence over the terms of your will. In other words, whoever you named as a beneficiary will inherit that asset—even if the beneficiary is a former spouse or estranged child.
Execute Powers of Attorney
A power of attorney is a legal document that authorizes a third party, called your “agent” or “attorney-in-fact,” to make certain decisions on your behalf. Estate plans often incorporate powers of attorney as a contingency measure. If you are seriously injured or develop a neurodegenerative disease like Alzheimer’s, your agent will be able to ensure that your lights stay on and your bills continue to be paid.
However, powers of attorney vary in their function, with some of the most common forms including:
- The durable power of attorney, which empowers your attorney-in-fact to make many different decisions on your behalf.
- The financial power of attorney, which can be used to execute financial transactions such as paying rent or managing an investment portfolio.
- The health care power of attorney, which lets a trusted loved one determine what sort medical treatment you should—and shouldn’t—receive if you are unable to offer your own consent.
Powers of attorney help preempt conflict between family members, who may have very different ideas of what constitutes your “best interest.”
Establish a Revocable Living Trust
A revocable living trust is a type of legal arrangement that lets you transfer assets to the care of a trustee, who must manage the trust’s assets in the best interest of the trust’s named beneficiaries. Trusts can be used to condition inheritances, avoid estate taxes, and control the frequency of distributions to your heirs.
Trusts can own many different kinds of assets, including:
- Your home
- Real property, including commercial and investment properties
- Bank accounts
- Investment accounts
- Bonds
- Business interests
In a revocable living trust, you retain full control of your trust assets until you die. You may change the terms of your trust whenever you see fit, and select or revoke beneficiaries as needed. Critically, since trust assets are not estate assets, they are not typically subject to probate, making it much more difficult for disgruntled heirs to challenge the terms of their inheritance.
Provide Alternate Inheritances
You don’t always have to choose between your spouse, your children, and your step-kids.
Ross & Shoalmire’s estate planning lawyers could help you explore alternate strategies to keep everyone in your family happy. You could leave alternate inheritances by:
- Leaving items of strong sentimental value to heirs who can’t be trusted with money
- Using life insurance policies and investment accounts to provide cash benefits to family members who won’t be entitled to a share of your estate
- Establishing an education trust to help your kids or stepchildren save for college
