blended families and estate planning

Life-Saving Tips About Estate Planning for Blended Families

     I want to tell you about a family from Lake Charles that I was working with.  The husband and wife have been married for a number of years, she had two children, he had one child, and his child had two children.  They were real specific about how they wanted things to go after both the husband and wife passed away. They have some property that they wanted to go to one of the husband’s grandchildren.  They also had funds that they wanted to have divided up 5 ways with one part for each of her two children, one part for his child and one part for each of his two grandchildren.  Of course, they wanted things to be protected after one of them died, so that there would be assurance that all those people would get the right things at the right time after the surviving spouse died.

     We got all of that set up and they are tickled to death that the property is going the right way, the money is going to be shared, and all of the probates will be avoided. You know, when married couples have things in their name, there is a probate or a succession when they pass away (some people call it probate and some people call it succession).  It’s that court procedure that the family goes through when the first spouse dies and then the family does it all over again when the surviving spouse dies.  If things are structured and titled often times in a revocable living trust than those probates are avoided and it makes it simpler and quicker for the family to inherit 100% of what the parents own.

     So, if you have a blended family situation like that and you want to make sure that the spouses protect themselves, they protect each other, but also protect the respective children of the different marriages, that's a really important issue to address. I see a lot of mistakes made and you want to make sure that you work with the right people and get it done right the first time.  You need to avoid lots of those family disasters.  If you would like to have a talk about it, give me a call.

 

What Everybody Ought to Know About Divorce and Estate Planning

     I was working with a new client recently who had been referred by another one of our clients.  His main concern was that he was in the process of going through a divorce. He had children and he wanted to make sure that everything was set up perfectly, so that when he passed away, things would go to his children the right way, ex-spouses would not be involved, and they would not be able to exert influence.  Fortunately, there was what you would call a pre-nup, or a marriage contract, or a separate property agreement in place before he married his wife whom he's divorcing.  So, it made the aspect of getting a divorce really simple.  He was able to keep everything that he had prior to the marriage and everything he had accumulated during the marriage, so that was a big savings. But, really he wanted to make sure that things went the right way for his children who are still young and not in a position to be able to handle it for themselves.

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     One kind of particular issue that we had to deal with was that he had set up an irrevocable life insurance trust for each of his children and he really did not like who the trustee was of one of those trusts.  Not that he didn't like the person, but he felt like that was not the most appropriate trustee. And you know, those irrevocable life insurance trusts are irrevocable, but as I read through that, I realized that the trustee could resign and appoint a successor trustee. So, he felt like the trustee, who he did not want to be the trustee, would do that.  So, there are lots of issues there when someone gets divorced.  One of the most important things that they can do is to get their estate legal plan either established or amended, so that the previous spouse, if you don't want the previous spouse to be involved, is really out of all the estate matters.  If that situation is what you have, feel free to reach out to us.