Reshaping an estate plan after marrying again often takes more profound thought than the first time around. Blended families offer some challenges for parents wanting to provide for their biological children after death. Making sure children inherit what a biological parent wants them to get may necessitate the utilization of other estate planning tools. Explore some examples of how parents can pass on an intended inheritance without muddying it in blended family semantics.
People of all financial means may use a trust to house funds and property. According to Forbes, a trust is a versatile tool available for passing money to biological children after remarriage. It allows the parent, or grantor, to deposit property or cash into the trust, which bears the children’s name. Since it is a beneficiary situation, the trust passes directly to the named person, rather than going through probate or a third-party. The grantor may not own property deposited within the trust, or it will pass in part to the co-owner.
Some parents prefer to pay for life insurance policies naming biological children as beneficiaries. The process for getting the money after death is simple as the insurance company doles out checks directly to named beneficiaries in the fashion dictated by the grantor. It also enables a parent to leave different amounts of money to each child if that is a prerogative.
If children are minors at the time a parent creates an estate plan, the parent may want to appoint someone to administer or manage the money the children will inherit. The appointee will oversee the financial needs of the children using the money until they turn 18 years old, or another age set out in the estate planning documents.