Television shows like “The Brady Bunch” always make the blended family look easy. If you think coordinating holidays is tough, consider how two families address the division of their estates after one or both of the spouses die.
The good news is there are ways to address the blended family situation. Having the right estate plan in place can allow you to protect your legacy for your children while still caring for the surviving spouse.
But if you do not have the correct documents in place, your story will be quite different.
In Arizona, if you die with no estate plan in place, the law provides that your spouse will receive their ½ of the community property and ½ of your separate property. Your descendants will receive your ½ of the community property and ½ of your separate property. For example, the house you hold as joint tenants (without right of survivorship) is now owned ½ by the surviving spouse and ½ by your descendants. Will the surviving spouse have to buy your children out of the house and is that financially possible? Will the house need to be sold so the proceeds can be divided? Will your children be kind and understanding or force an immediate sale of the property? Is this what either of you want for the other?
As another example, the inheritance you received from your father will be split 50/50 between your spouse and your children. Did your father intend for your spouse to receive a portion of his estate or would he rather see it all go to his grandchildren?
In most cases, not having any estate plan in place adds to the family dysfunction. Surviving spouse has priority to act as your personal representative, but how will your children feel about that? Will that add to the animosity between the parties? Many times a neutral fiduciary is hired to act in that role. If you think you saved money by not creating an estate plan, the probate and third party fiduciary just cost you significantly more.
By designing an estate plan that is specific to your family dynamic, you can allow the surviving spouse to continue to utilize the home and assets during their lifetime. If you are concerned your spouse will spend all the assets or leave them all to his/her children, you can provide for specific distributions to beneficiaries upon your passing.
One of the greatest gifts you can give your family is a clear plan for how to handle your estate after you die. There are many options available, but doing nothing should not be the one you choose.
To learn more about structuring your assets in a guaranteed estate plan call or email us at:
Keystone Law Firm 2701 W. Queen Creek Rd. #3 Chandler, AZ 85248