Remarriage is no longer a rarity. According to statistics from Pew Research, nearly one in every four married people has been married before, up from about one in 10 in 1960. While finding a long-term partner to be happy with is something to celebrate, a remarriage can introduce some new questions that need answering.
That includes how it will affect your plans for inheritance for your children.
Avoid disinheriting your children
For many parents, ensuring certain items, assets or property is passed to their children is an important part of estate planning. A remarriage, if you’re not careful, can throw a wrench in those hopes. This can happen for a few reasons.
If you die without a will, for example, the courts will divide your property based on state succession law. In Colorado, if the deceased has a spouse and then three children from a previous relationship, the spouse would get the first $150,000 of the estate, then half the estate’s balance. The three children would then split whatever is left over.
Just having a will doesn’t guarantee things end up with your children. Treasured belongings, such as family heirlooms or special items, could end up in anyone’s hands if you aren’t specific. That is why it is important to be as detailed as possible. That may mean specifically listing individual items and who should inherit them.
You should also consider accounts where you have to name a beneficiary, such as life insurance. Whoever is listed as the beneficiary receives the funds, regardless of if you specified something else in a will. If the policy has been active for awhile, that could mean your ex stands to benefit.
How to avoid this
The key to ensuring your legacy continues as you hope is proper estate planning. That means:
- Writing a thorough will – not relying on verbal agreements
- Discussing your plans and wishes with loved ones
- Updating account beneficiaries
- Consulting with an attorney to cover all your bases.
While wills are the most well-known estate planning tool, trusts are another option, and can be quite effective when utilized correctly. With a trust, you can set aside specific assets for a specific purpose, and leave management of those assets to a trusted third party that will ensure your wishes are followed. A trust may also allow you to initially pass property to your spouse, with directions to then give it to your children upon your spouse’s death.
Remember, every individual’s situation is unique. A full, thorough estate plan requires a meticulous review and the consideration of many factors, often with help from a knowledgeable estate planning attorney. If you’re not careful, the important things you want to see happen may go awry.