Blended families and second marriages bring love, joy, and complexity—but they also create unique estate planning challenges. In this episode of Estate Planning Beyond the Binder, Brian Chew, Managing Partner at OC Wills and Trusts, shares insights on how to protect both a surviving spouse and children from prior relationships, while avoiding costly mistakes that often occur when families fail to plan.
Why is estate planning more complicated for blended families?
According to Brian Chew, the core challenge with blended families usually centers on relationships with stepchildren and stepparents. While some blended families enjoy strong bonds, others may have little or no connection, making it risky to rely on assumptions about inheritance.
Unlike traditional families, where parents typically trust one another to provide for children, blended family situations raise questions such as:
- How can a parent ensure their biological children are cared for if they pass away first?
- Will a new spouse use inherited assets to also benefit stepchildren, or only their own children?
These questions highlight why legal protections—not just trust or moral obligations—are essential.
What are the most common mistakes in second marriages?
Brian Chew explains that one of the biggest mistakes is failing to create enforceable protections for children. A common scenario is when a parent leaves all assets to a new spouse under a joint trust, expecting that the surviving spouse will later distribute them fairly. Because most joint trusts are revocable, the surviving spouse can legally change the terms at any time, potentially disinheriting the deceased spouse’s children.
The opposite mistake also occurs: leaving everything directly to children without ensuring the surviving spouse has enough financial security. This imbalance often leads to conflict and hardship, especially when long-term care and housing costs arise.
How can families protect the home in blended family estate planning?
The family home is one of the most complex issues in blended families. Brian Chew outlines strategies such as allowing the surviving spouse to live in the home for life—or for a set period of time—while ensuring that ownership eventually reverts to the children.
For example, a trust can give the surviving spouse the right to occupy the property while requiring them to maintain expenses and preserve the equity for the children. This approach balances housing stability for the spouse with asset preservation for the next generation.
Should couples in second marriages use joint trusts or separate trusts?
When each spouse has significant assets, it may be wiser to establish separate trusts rather than a single joint trust. With separate trusts, each person can control how their assets are distributed after death, ensuring their wishes for children or other beneficiaries are honored.
Brian Chew notes that while couples may trust each other during life, the situation changes once one spouse passes. Relationships between stepchildren and the surviving spouse may weaken over time, creating opportunities for conflict. Separate trusts can prevent these disputes.
How do prenuptial and postnuptial agreements affect estate planning?
Prenuptial and postnuptial agreements play an important role in blended family planning. These contracts determine what is considered community property versus separate property, directly impacting what can be passed on through a trust.
Without such agreements, disputes often arise after death, much like in a divorce, over whether certain assets belong to the surviving spouse or to the deceased spouse’s heirs. Brian Chew emphasizes that estate planning cannot give away property a person does not legally own—making clarity around ownership critical.
Why is it important to update estate plans after remarriage?
One of the most common oversights Brian Chew sees is failing to update estate plans after a second marriage. Some individuals keep an old plan that leaves everything to their children, unintentionally excluding the new spouse. Others forget to update decision-makers, such as trustees or healthcare agents.
Life events such as divorce and remarriage are major turning points, and Brian stresses the need to ensure estate planning documents reflect current relationships and wishes.
How can families prevent conflict in blended family estate planning?
To minimize disputes, Brian Chew advises families to clearly identify:
- Who they want to provide for, and
- Who should be in charge of carrying out the plan.
Sometimes appointing a neutral third-party trustee—such as a corporate trustee or private fiduciary—is the best way to avoid conflicts between a surviving spouse and children.
The family home remains the most common source of disputes. Questions about who pays the mortgage, property taxes, or insurance, and whether the surviving spouse can remain in the home, should all be addressed in advance. Transition periods can also help, such as allowing a spouse to stay in the home for six months or a year before it passes to the children.
Conclusion
Blended families and second marriages require estate planning strategies that go beyond a one-size-fits-all approach. By using trusts, prenuptial agreements, and careful structuring of home ownership, families can protect both spouses and children while reducing the risk of disputes.
As Brian Chew emphasizes, the key is to move beyond moral expectations and instead create legally enforceable protections that ensure your legacy is carried out as intended.
