Estate Planning for a traditional family tends to be fairly straightforward. The assets of either the husband or the wife will generally go to the survivor, and then be divided equally among their children on the death of the survivor. Certainly, there are exceptions where one spouse is the recipient of a large inheritance and needs to leave most of that directly to the children, or if one or more of the children have special needs or develop a substance abuse issue. In such cases, more complicated planning is appropriate; however, for most traditional families, this is enough.

Mixed families, however, almost always require additional considerations. It is likely that the assets of the spouses are unequal. If both spouses have children from prior relationships, each has an incentive to leave most of their assets only to their children, and not the children of their spouse. This is especially problematic where the spouses share assets jointly as careful planning is required to prevent the surviving spouse from cutting their step children out of the inheritance after the death of the first to die. Possible solutions range from setting up lifetime gifts into trusts by each parent for the benefit of their own children, purchasing life insurance for their individual kids benefit (possibly into a life insurance trust), setting up beneficiary designations on investment accounts with special waivers signed by their spouse, to carefully drafted pre- or post- nuptial agreements with detailed obligations baked into it relating to the preexisting children’s inheritance.

Additionally, some folks in blended families may not trust their new spouse to run or manage an existing business or investment mechanism, or may not want to leave such a large amount to their spouse in the case. In those cases, either the spouses will need to agree to such terms via a pre- or post- nuptial agreement, or the wealthy spouse will need to take more complex steps. Possibly the wealthy spouse could create an “Elective Share Trust” to meet their statutory inheritance obligations pursuant to the Florida Statutes, whereby they must leave at least 30% of their “Elective Estate” to their surviving partner, freeing up the remainder of their estate to leave to their children. Another option would be to place the business or investment which needs management in a specially designed trust which would provide the surviving spouse income for life, but would allow for the management of such property to be carried out by a more knowledgeable or trustworthy individual.

The complexities involved in planning for a mixed or blended family require a careful analysis of both couples assets and family situation as well as several very difficult conversations about trust and the desired outcomes. It is important to address these issues while both spouses are alive and well so that appropriate steps can be taken to safeguard the children or preexisting assets or inheritances. Speak with an Estate Planning professional today to begin the conversation.

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