Disinheriting Your Kids: The Unintended Consequences of Remarrying
Updated: Mar 26, 2019
If you marry and have children from a previous marriage or relationship, estate planning is essential to make sure your assets get passed to your children.
When The Brady Bunch premiered in 1969, the concept of a blended family with children from previous relationships was unusual enough to warrant a sitcom order. Today, however, blended families are increasingly commonplace. According to the most recent U.S. Census, seventeen percent of people remarry after their first marriage ends, many with children. In addition, many people enter their first marriage with children from a previous relationship.
For such people, estate planning is crucial to provide for these children in the event of their death. Especially for people entering a marriage later in life with significant assets, estate planning is the only way to ensure that when they die, the assets they intended to pass to their children end up there. Without estate planning, Michigan law controls the distribution of all the person's property.
If a person dies without a will or a trust, it is called dying "intestate." If a person dies intestate, in almost all cases some or all of the person's real estate and personal property will have to be distributed by initiating probate court proceedings. Dealing with probate court proceedings can be stressful, time-consuming, and expensive. In addition, Michigan laws of intestate succession control distribution of the person's property—it does not matter what they wanted!
Let's return to The Brady Bunch for an example. Carol Brady, matriarch of the Brady clan, had three biological daughters (all of them with hair of gold), and three step sons to whom she was not biologically related. If the Bradys moved to Michigan and Carol was the first of the Brady family to pass away and did not do any estate planning, the Michigan laws of intestate succession control who gets Carol's property. Mike Brady, Carol's surviving spouse, would receive the first $100,000 of Carol's estate, with everything after that being split up 50% to Mike and 50% to Carol's three biological daughters, Marsha, Jan, and Cindy.
But what if Carol and Mike talked about these issues during their life and decided that Carol's three girls should get all of Carol's property after her death and Mike's three boys should get all of his? The answer, unfortunately, is "too bad." The only way for Carol to have these wishes fulfilled would have been to complete an estate plan before she passed away.
A recent CNBC article on this topic explains that "[w]hile creating an estate plan might not seem appealing or fun, the process can help ensure that your assets end up where you want and your wishes are carried out." (read the full article at: https://www.cnbc.com/2019/01/17/estate-planning-for-second-marriages-when-you-have-kids.html)
If you have not yet created an estate plan, or think your plan needs updating, give Jim Wald Law a call. We would be happy to help!