The Estate Planning Challenge of Blended Families

The Estate Planning Challenge of Blended Families

Probate & Estate

Blended families bring unique joys—but also unique challenges, especially when it comes to inheritance and estate planning. Without a clear plan, disputes can arise over who inherits what. Financial planning tailored to your family’s structure is essential for preserving relationships and ensuring your wishes are honored.

Here’s how to navigate financial planning for blended families:

1. Define Your Estate Planning Goals

Inheritance planning can be complicated when stepchildren and biological children are involved, particularly if your spouse isn’t their parent. Ask yourself:

  • What’s most important to me?
    Do you want your assets to support your spouse, your children, or both?

  • Are my children old enough to inherit directly?
    If not, you’ll need to set up structures like trusts to protect their share until they’re ready.

Pro Tip: Use estate planning tools like a Durable Power of Attorney to prevent disputes over who manages your affairs if you become incapacitated. For custody concerns, a clear Will can determine whether your children stay with their biological parent or your current spouse.

2. Regularly Review and Update Your Plan

Life is full of changes—marriages, divorces, new children, or evolving relationships. If your situation shifts, so should your estate plan.

Example:
When you first married, your focus might have been on your biological children. But now, you might view your stepchildren as your own. Update your plan to reflect this sentiment.

Key Tip: Revisit your plan every few years or after major life events to ensure it aligns with your goals and family dynamics.

3. Communicate Openly

Transparency can prevent family conflicts down the road. Sit down with your loved ones to explain your decisions and ensure everyone understands your intentions.

  • Discuss your plans with your spouse, but don’t feel pressured to compromise on your core wishes.
  • Talk to your children and stepchildren about their inheritance so they know what to expect.

Why It Matters: Lack of communication is a major cause of inheritance disputes. Open conversations now can save heartache later.

4. Be Cautious About Potential Conflicts

Blended families can face unique inheritance challenges. For example:

  • A wealthier spouse with their own children may want to safeguard their assets for those children, which can lead to tension with the new spouse.
  • Family heirlooms or sentimental items may cause disputes if not clearly designated in your plan.

How to Avoid Issues:

  • Prenuptial or Domestic Partnership Agreements: These documents clarify financial arrangements and inheritance expectations, reducing surprises.
  • Lifetime Gifting: Consider giving significant gifts while you’re alive, so you retain control and avoid executor conflicts later.

Pro Tip: Gifts under $15,000 per year (per recipient) don’t require federal reporting, helping you sidestep gift tax implications.

5. Balance Fairness and Your True Wishes

It’s natural to want to be fair to everyone, but fairness doesn’t always mean equality. For example:

  • You might leave heirlooms to biological relatives while still ensuring stepchildren receive monetary assets.
  • A charity, scholarship, or pet trust might also be part of your estate plan.

Golden Rule: Plan according to your values, even if it’s not what everyone expects. Discuss your decisions with your attorney and tax advisor for professional guidance.

Common Questions About Estate Planning for Blended Families

1. Do I need a lawyer for estate planning in a blended family?
Yes. Blended families have unique considerations, and a skilled attorney can ensure your plan is legally sound and tailored to your needs.

2. What happens if I don’t have a Will?
Without a Will, state laws determine inheritance—often favoring biological relatives over stepchildren or partners.

3. How can I avoid family disputes over heirlooms?
Clearly outline who receives sentimental items in your plan. Consider discussing your decisions with your family to minimize confusion or resentment.

Take the Next Step Today

Financial planning for blended families can be complex, but it’s essential for protecting your loved ones and honoring your wishes. By defining your goals, reviewing your plan regularly, communicating openly, and seeking professional advice, you can avoid common pitfalls and bring peace of mind to your family.

Contact Estate Planning Attorney Chuck Bendig today to start planning for your unique situation.

Let insurance pay for my medical bills or file a personal injury suit?

Let insurance pay for my medical bills or file a personal injury suit?

Personal Injury

Medical bills are the most common reason people begin a personal injury case. It is not unreasonable that if a person or business causes injury to someone, that person or business should at least be liable for paying all medical bills resulting from the injury.

“But what if my own health insurance company has already paid for my medical bills? Does it make sense to sue the person or business that was responsible for my injury?”

Consider this example of a hypothetical man named Tom.

Tom is walking down the street when he is struck by a piece of machinery being operated by a construction worker hanging a new sign on a storefront. Tom is rushed to the hospital. His left shoulder requires immediate surgery. Over the course of several months, he also visits a physical therapist to strengthen his repaired shoulder. The treatments total $40,000 and Tom’s health insurance pays for everything, except the deductible, pain and suffering, and lost wages.

Needing reimbursement & compensation, Tom hires an attorney who files a lawsuit against a construction company involved in the project. Tom’s health insurance company files a lien against that lawsuit. By filing the lien, the insurance company is arguing, “Tom is the one who was injured, therefore it’s his prerogative to sue. However, we paid $40,000 for his medical care so his favorable judgment should reimburse us also.”

In most states, the health insurance company’s lien would be valid. Let’s assume that Tom goes to court and he is awarded $90,000 for medical costs, pain and suffering, and lost wages.

After reimbursing his health insurance company and paying his legal fees, Tom would receive approximately $20,300. That can greatly help to cover his bills and inconvenience.

—

If you or someone you know has been injured due to negligence, call (614) 878-7777 to discuss your case with attorney Chuck Bendig. The call is completely free and with no obligation.

This video contains my Last Will and Testament

This video contains my Last Will and Testament

Wills

Have you ever thought, ‘When I die, I’ll leave a video for my loved ones’? More and more people are preparing a video in which they read their will and explain why they’ve left certain belongings to some and not others. The recording can show the execution of the will and can be compelling proof that you were mentally competent, but is it a good idea?

Let’s explore some of the pros and cons of a video will.

Pros:

A video Will can head off claims that you weren’t of sound mind or were being unduly influenced in some way when you signed your will. A video will help in the event that someone is disappointed and decides to hire a lawyer to contest your Will. The video can also show you and your witnesses signing your Will. In this case, it clearly demonstrates that you were rational, knew the contents of your Will and were expressing your own wishes.

A video Will can supplement your formal estate plan: For example, if you want one child to serve as an executor, a video Will is your chance to say so. Your other children or family won’t be left to wonder about your actions. If you want to get into detail, a video Will can also express how you’d like your family to divvy up items of sentimental value.

Cons:

(This is a big one.) Although you may use your video Will to convey how your family should distribute sentimental items, you need to know that your wishes are not legally enforceable. Meaning your video won’t be accepted by a probate court, a bank, or any other institution that controls assets in your name. Only a formal paper Will is legally enforceable.

Videos don’t last forever and therefore, are subject to damage.

If you opt for a video Will, consider it as an add-on to a formal, legal, paper will, filed by an estate planning attorney, and remember these tips:

  • Use a quality camera that clearly identifies your face.
  • Speak clearly without distortion and eliminate as much background noise as possible.
  • Keep the video-captured area at medium close-up.
  • The video cannot be edited and must be submitted with any kind of technical data necessary to play it back.
  • Some states want you to be sworn in by a person authorized by law to take oaths.
  • Prior to administering the oath, any officers of the court have to identify themselves on camera.
  • Mention the date, time and place of the recording prior to recounting your last wishes and the recorded names of your beneficiaries, as well as the names and addresses of the will’s witnesses if they’re not present at the taping.
  • The video Will should run without interruption.

Remember, it’s still the law that to be valid, a Last Will and Testament must be on paper and signed. If you have nothing but a recording of the deceased person’s last wishes, you’re unlikely to have a Will that will hold up in court.

It is important to consult with a legal professional about the laws and regulations in your jurisdiction to determine the validity and suitability of a video Will.

Finally, keep in mind that a Will, in either written or video form, is not the only estate planning tool you have. Various trusts can also help make sure your estate is left according to your wishes.

*WL – WebLinks Directory

When should I begin my estate planning?

When should I begin my estate planning?

Probate & Estate, Wills

There’s an easy answer to this. It’s never too early. You’ve heard tomorrow isn’t promised. It’s true. At worst, you could die before getting around to executing a plan, and that could leave your heirs with a costly, divisive mess.

What happens if you suffer a debilitating health crisis that prevents you from seeing that your wishes are carried out, or even prevents you from signing essential documents?

Did you know that applicable laws that are favorable to you now may be changed to be less so later? The more years that slip by, the more vulnerable you become to being taken advantage of because of your advanced age.

If your needs change in the future, you can modify your plan; although prospective change isn’t a valid excuse for delay. Do your best to look out for yourself and for your family now, and be sure to keep your plan current. Make sure that you have the right documents and that they are in keeping with estate laws now and in the future. An estate & probate attorney can help you with this.

Here is a quick summary of the estate-planning process

Getting started on estate planning can be a lot simpler than you think. To start with, you will want to go through these basic steps:

Take inventory of your assets, including investments, retirement accounts, insurance policies, real estate holdings and valuable items including your digital assets.
Determine your goals and your inheritors. If you have minor children or elderly loved one, who will care for them when you are gone?
Designate a person that you trust to manage your business affairs; Power of Attorney.
Designate a person to direct your medical care should you become incapacitated; Power of Attorney Healthcare
Designate an Executor to implement the directives outlined in your Will.

After deciding what kinds of bequests you wish to make, it’s important to discuss your plans with your heirs. You don’t want to leave any unpleasant surprises. Think about how best to leave your assets. A simple Will may not be the best option. An attorney can help you with a variety of trusts, which have many advantages in creating an estate plan.

I can’t stress enough that the earlier and the greater the degree of clarity you use when you outline your plans to family and friends, the less chance there will be for disagreements when you are gone.

Who Should Be Your Inheritors?

Who Should Be Your Inheritors?

Probate & Estate, Wills

If you’ve thought about estate planning and have contemplated when and how to distribute your assets to your heirs, read on. You probably imagine that this process will entail a series of trade-offs to prevent emotion-laden family problems. However, when you focus on numbers, you’re dealing with objective and straightforward facts.

But, you are in murkier waters when considering who should inherit your wealth, and you understand that emotions will most likely factor into those decisions. The truth is, there is no correct answer to how to distribute your estate. But here are some questions that will help frame your thinking:

  • How much would you like to leave to charity and how much to your family?
  • Will you divide your assets equally among your heirs, or on some other basis, like need or good behavior?
  • What form does your estate take? Is it cash, securities or some other assets? Do you want to give these outright or leave them in a trust?
  • Can the heirs you chose to handle the responsibility of managing their own finances, or will they need help?
  • If you use a trust, will there be provisions, what will they be and whom will you designate as the trustee?

Maybe we should take a step back and clarify what exactly an heir is. An heir is a relation who potentially is entitled to money or property after you die, such as a spouse or child. Laws in each state outline the exact order in which heirs inherit property, but the list stops at a certain point. Not every heir automatically inherits.

The term “heir” is often used when someone dies without a will. When that happens, the estate administrator tries to find who rightfully inherits the property.

A “beneficiary” is a person or an organization who receives money or property by being specifically named in your will or trust. Beneficiaries can include charities, descendants or close friends, and even places of worship.

If you leave a will, beneficiaries often have more rights to whatever assets remain after probate. If you don’t leave a will, the assets go to the first heir in line, and the process continues until a living blood relative is found. Keep in mind that rules may vary depending on the jurisdiction.

Trusts can help ensure the people you want to get your assets, in the form you want. Ensuring the transfer of your hard-earned assets to your heirs is a crucial part of a well-thought-out estate plan. Although it may be uncomfortable to have a conversation like this with your spouse, your children, and other possible heirs, it will enable them to ask questions and clarify what your exact wishes are. While the estate planning talk deals with sensitive issues, it will mean a smoother transition for your heirs after your death.

Get started with your estate plan.