When thinking about estate planning, most people with children and grandchild feel good about leaving these family members a treasured legacy. This may include special heirlooms handed down through the generations or financial assets.
Estate planning after remarrying may pose unique challenges when both spouses bring children and possibly grandchildren into the marriage.
Surviving spouses and biological children
According to Forbes, a remarried person may assume that their assets will be inherited first by their surviving spouse and then flow to their biological children once the spouse dies. However, if no trust or other clear plans dictate this, the children may never receive anything. This may happen if the surviving spouse ultimately leaves the assets to their own biological children, lives long enough so as to spend all of the money or otherwise disposes of the assets.
A qualified terminable interest trust allows for the surviving spouse to receive an income from the trust for the remainder of their life and for the property in the trust to be inherited by the first spouse’s children when the surviving spouse dies.
Joint and separate assets
As explained by CNBC, some remarried spouses choose to comingle all of their assets while others may opt to keep some assets separate. The choice to maintain some separate assets may facilitate leaving those assets directly to one’s own children.
Another means of providing for multiple parties in an estate plan after a second marriage may include the use of beneficiaries on accounts. Some of these assets may be directed to one set of heirs while other assets in a trust or a will may be reserved for others.
