The state of the modern family is changing. According to recent polls conducted by the Pew Research Center, 4 out of 10 Americans have at least one relative in their family who is considered a step relative. The National Center for Family and Marriage Research discovered that approximately one-third of all American weddings create step relatives and blended families. As a result, it is important to take into account the unique legal and financial hurdles created by blended families, and to focus on estate planning that ensures all assets are protected and distributed according to the wishes and intentions of the deceased.
In a case highlighting the importance of estate planning in families with stepchildren and stepparents, a North Dakota couple, William and Patricia Clairmont, created two irrevocable trusts for Matthew, their daughter’s son. In both trusts, “the brothers and sisters” of Matthew would be beneficiaries in the event of Matthew’s death. The Clairmonts were not given legal advice regarding the effect this definition might have. So, when Matthew unexpectedly died at the age of 25, the money actually went to Matthew’s stepsiblings who were a result of the remarriage of Matthew’s father to another woman.
The Clairmonts faced a significant legal battle in recouping the money, and their case eventually ended up in the North Dakota Supreme Court. They petitioned the courts to reinterpret the phrase “the brothers and sisters” of Matthew as those who were in Matthew’s lineage and bloodline. While the court eventually granted their petition, it might have turned out differently for the Clairmonts.
If you have a blended family or have stepchildren/steprelatives, it is important to consult an estate planning attorney about the potential conflicts that could arise in the event of your death. While a situation might be a certain way today, you should always consider what might happen if things should change. Would your family be protected in the event of a divorce, remarriage or catastrophic creditor claim?
Beyond establishing a will or an estate plan, considerations should also be given to ensure that the document detailing your intentions and wishes is written properly. This means that it has to be worded in a clear, unambiguous manner to avoid future conflicts and contests at the time of your death.
An estate planning attorney will have experience and knowledge about the laws relating to wills and trusts. He or she should be able to answer any questions you might have concerning your own estate plan and the effect it will have on your blended family.