Key Steps in Effective Estate Planning for Blended Families

Estate planning for a blended family means making clear decisions about how you want to provide for your spouse and children, especially when you have children from a previous relationship. You may want to support your spouse without losing sight of what you want your children to inherit. Balancing these goals can be challenging, particularly when family members have different needs and expectations.  

A well-planned estate can clearly state your wishes and help prevent uncertainty about what should happen to your property. The steps we outlined below can help you address the key decisions involved in planning for your blended family. 

At Lewis & Van Sickle, LLC, with offices in Green Bay and Pulaski, Wisconsin, we help individuals and families prepare wills, trusts, powers of attorney, and other estate planning documents. Our team can help you create a plan that accounts for your family relationships, property, and future wishes. Contact us now to schedule a consultation. 

Step 1: Identify Who You Want to Protect

Start by identifying the people you want your estate plan to benefit and what you want each person to receive. In a blended family, that may include your current spouse, children you share, children from previous relationships, stepchildren, or other relatives. 

Do not assume Wisconsin intestacy law (the law that determines who inherits property when there is no controlling will) will produce the result you want. If all your surviving descendants are also descendants of your surviving spouse, your spouse generally receives the entire intestate estate. Different rules apply when at least one surviving descendant is not also a descendant of your surviving spouse. 

Identifying your intended beneficiaries allows you to address these issues directly rather than relying on Wisconsin's default inheritance rules. 

Step 2: Decide How to Balance Your Spouse’s and Children’s Interests

Consider what you want your spouse to receive and what you ultimately want to leave to your children. Leaving property outright to your spouse may not accomplish your goals if you also want a portion of that property to pass to your children later.

A trust may help you address both goals by setting terms for how the property is managed, how your spouse may benefit from it, and who receives the remaining property after your spouse's death. Understanding the differences between wills and trusts can help you determine which documents may work for your family. We can explain your options and help you prepare estate planning documents that reflect your wishes for both your spouse and children. 

Step 3: Review How Each Asset Will Actually Pass

Your will does not necessarily control every asset you own. Some property can transfer according to its ownership arrangement or a beneficiary designation instead. 

Review your retirement accounts, life insurance, bank and investment accounts, real estate, jointly owned property, and trust assets. For example, Wisconsin law allows an interest in real property to pass to a designated transfer-on-death beneficiary when the legal requirements are met. 

Compare how each asset will transfer with the instructions in your will or trust. Doing so can help you identify inconsistencies before they affect what your spouse or children receive. 

Step 4: Be Clear About Gifts to Children and Stepchildren

Clearly identify the children and stepchildren you want to benefit rather than assuming your estate plan will treat each family relationship the way you expect. This can be particularly important when your blended family includes stepchildren and children from different relationships. 

If you want a stepchild or another particular person to receive property, address that intention expressly in the appropriate documents or beneficiary arrangements. If different children should receive particular assets or different shares, state those choices clearly as well. 

For some families, a revocable living trust can provide more detailed instructions about how and when beneficiaries receive trust property. Whether a trust is appropriate depends on your property, family circumstances, and goals. 

Step 5: Choose the Right People to Carry Out Your Plan

Your Wisconsin estate plan may require you to choose several people to act on your behalf or administer property. For example, you may nominate a personal representative to administer your probate estate and select a trustee to manage trust property. 

In a blended family, consider whether choosing your spouse, an adult child, or another relative could create practical problems or conflicts. Choose someone who can handle the responsibilities and follow your written instructions, and consider naming a successor in case your first choice cannot serve. 

Step 6: Plan for Incapacity as Well as Death

Your estate plan should also address who can act for you if you become unable to make certain decisions. Wisconsin recognizes a Power of Attorney for Health Care and a Power of Attorney for Finance and Property. 

A health care power of attorney allows you to name an agent to make health care decisions for you when the agent's authority becomes effective under Wisconsin law. A financial power of attorney can give an agent authority over the financial and property matters specified in the document. 

For a blended family, choosing these agents deserves careful thought, particularly when a spouse and adult children may have different views. We can help you prepare the appropriate documents and determine how your choices fit with the rest of your estate plan.  

Step 7: Determine Whether a Marital Property Agreement Should Be Part of Your Plan

Wisconsin's marital property laws can affect estate planning for married couples. Wisconsin law allows spouses to enter into a marital property agreement addressing rights in their property and the disposition of property at death. 

This may be particularly relevant when you or your spouse entered the marriage with property or have children from previous relationships. If you already have a marital property agreement, review it when preparing or updating your estate plan so that your will, trust, and property arrangements account for its terms. Coordinating these documents can reduce the risk that different parts of your plan express conflicting intentions. 

Step 8: Review Your Estate Plan After Major Family Changes

Review your estate plan whenever a major change affects your family or finances. Marriage, divorce, the birth or adoption of a child, the death of a beneficiary, or a significant change in your assets can leave parts of your existing plan inconsistent with your current wishes. 

Check your will, trust, powers of attorney, and accounts with beneficiary designations. For example, you may need to change who will inherit an account, serve as your personal representative or trustee, or make financial or health care decisions for you. Do not assume that a change in your family automatically updates every document or beneficiary designation. 

You should also review your estate plan periodically even when no major event occurs. Doing so gives you a chance to identify outdated instructions and make necessary changes so your documents continue to reflect your current intentions and circumstances. 

Get Legal Help With Your Blended Family Estate Plan in Wisconsin

Effective estate planning for a blended family requires you to look at more than who receives property under your will. A complete plan should address how your assets will pass, how you want to provide for your spouse and children, who will carry out your instructions, and who can act for you if you become incapacitated. 

At Lewis & Van Sickle, LLC, we provide estate planning services from our offices in Green Bay and Pulaski, Wisconsin. We focus on estate planning and probate, serving clients throughout Northeast Wisconsin and the greater Green Bay area, including Howard, Suamico, and Oconto.

Our attorney, James E. Lewis, can review your existing documents or help you prepare an estate plan that addresses the needs of your blended family. Contact us today to discuss your estate planning needs.