It isn’t unusual for people to put off estate planning. In fact, in 2020, only 32% of Americans report having completed a will or other estate planning documents. Not having a will can become a big burden to your family members if you pass away, and if you have a blended family, more than likely, your assets won’t be distributed in a way you’d like them to be.
Potential pitfalls in handling assets for blended families
In fact, even having a will may not be enough if you’d like your children to receive some of your assets. If you leave your new wife all your assets, as years go by, she could decide to leave your children out of her own will, passing some of your assets on to her children.
Also, what if your surviving spouse marries? Will she choose to leave the assets you’ve given her to her new spouse? It’s a possibility.
You also may want to leave some assets to your stepchildren. You’ll need to name them in your will or establish a trust that will ensure some of your assets go to them and your biological children.
Apart from a will, if you have a blended family, you will also need to name who will have power of attorney for you or who will act carry out your health care directive. Do you want your current spouse to make those decisions? Or your children? Without those estate planning pieces in place, if you were to become incapacitated suddenly, your loved ones could end up fighting over decisions for your care or your finances.
The advantages of estate planning
By creating a will, establishing a trust for your children, and having your power of attorney and health care proxy named, you will establish your wishes for your family members. You will be able to ensure your children will receive some of your assets and your family understands who will be making decisions about your care and finances if needed.
All of this planning will reduce stress on your family, and hopefully, reduce the chances of conflict over handling your estate.