If you are in a second marriage or considering getting remarried and you have children from your first marriage, you should make it a priority to establish a good estate plan that effectively provides for your children and your new spouse. Your estate plan may even need to accommodate stipulations from a divorce decree that mandate certain assets be left to your former spouse.
Basic wills not sufficient for blended families
As explained by Forbes, one of the downsides to inadequate estate planning for a remarried couple is the potential for a surviving spouse not to carry out a deceased spouse’s wishes. This may be one of the ways that a person’s biological children end up being disinherited without having intended for this to happen.
Qualified terminable interest property trust
A QTIP trust is a vehicle that allows the principal assets to be retained for your children or grandchildren after your spouse dies. After you die and before your spouse dies, the trust then provides a regular source of income to your spouse without touching the principal. The qualified terminable interest property trust also gives you the ability to defer some estate taxes, which may be beneficial for your estate and your beneficiaries. In addition to updating your beneficiary designations, a QTIP trust may give you the flexibility you need.
If you would like to learn more about how a qualified terminable interest property trust may be able to help you and your new spouse care for each other and your separate children, please feel free to visit the blended family’s trust options page of our estate planning website.