Weddings are times of joy and optimism. The vows are sincere and well intentioned. The couple may live happily ever after. But life happens and so does death and divorce. It is not something we want to think about, but it is something we must face with courage and grace should it happen.
Most of us know someone who has lost a spouse to death. And nearly all of us know someone who has had to cope with a divorce. How we manage these situations can make a great deal of difference to our children and to our extended families.
One woman who was sure her marriage to her daughter’s father was “forever,” but discovered just how much coping skill was required when she faced divorce. She never spoke ill of her daughter’s father, even when she was disappointed and hurting. When a friend commented, she replied, “I once loved him enough to marry him so he must have some redeeming traits. If I want my daughter to grow up happy and well adjusted, I’d best work on remembering what they are!”
That attitude did indeed make a great deal of difference to her daughter who was able to maintain a good relationship with both parents, who in time both remarried. This family, like so many, became a blended family, with new challenges and responsibilities.
You don’t need to be Elizabeth Taylor to be married more than once. If you’ve had more than one spouse, you have special financial and estate planning needs, especially if you have children with each spouse. Neglecting these issues is a surefire way to create a less-than-desired result in the event of illness, incapacity, or death. The best way to have a smooth transition upon disability or death is to create a comprehensive strategy before you aren’t able to execute the papers.
A Special Strategy
Remarriage may result in cordial, but often not close, step relations. Frequently, such people thrown together by marriage merely tolerate each other until the biological parent dies or becomes disabled. For example, if the spouse who has the majority of assets dies first, whose interest is primary? Will it be the surviving spouse or the children? If a parent is not careful, his or her children may be unintentionally disinherited. If the children are protected, the surviving spouse may be disinherited. What’s a person to do?
A special plan for a blended family would include a prenuptial agreement along with a fully funded, revocable living trust. This can only be accomplished by working with a trusted adviser who has specialized knowledge in extended families. Another key component in an estate plan for a blended family is the successor trustee. It’s essential that the successor is savvy, compassionate, and, hopefully, familiar with family issues.
A Checklist to Guide You
The following are some questions you should address with your adviser:
- How is the successor trustee selected?
- How will the successor trustee feel about paying money to the person who might not select him?
- How can the surviving spouse be prevented from changing the deceased spouse’s beneficiaries?
- How will the children feel about the step-parent spending what they consider to be their inheritance?
- How will the children feel about the spouse making cessation of life choices?
- What is the relationship between the successor trustee and the surviving spouse or the children?
- How do the trusted advisers ensure the succession plan will go as planned?
- How will the assets earned during the marriage be distributed?
- How should the required retirement plan distributions be made?
- How long should the children wait to receive their money, especially if the surviving spouse is only a few years older than the children?
By addressing these issues now, you’ll have greater peace of mind. You can ensure that your goals, aspirations, and desires will be carried out when can no longer oversee them yourself.