A lot of people stress over estate planning. Truth be told, though, the estate planning process doesn’t have to be that difficult. You just have to know the law, your estate planning options, and how the law and your estate planning options fit into your family dynamics. To create the plan that is best for you and your family, though, you do need to be diligent and thorough. Here’s one example of why you should do so.
Estate planning in blended families
Many New Jersey residents are part of a blended family. For estate planning purposes, this can cause complexities. The reason is because if you pass away without an estate plan, then your assets will be distributed in accordance with the state’s intestate inheritance laws. This means that if your spouse has children from another relationship, then that spouse would inherit 25% of your estate plus half of the remaining balance. Although your children will inherit the remainder of the estate, there’s still risk involved.
This is because, without an estate plan, your spouse is under no obligation to leave the inheritance that he or she received to your children. In many cases, this inheritance flows down the spouse’s family line, which can have financial implications for your children and grandchildren.
What can you do?
One of your best options is to utilize a remainder trust. A remainder trust allows you to leave assets to your spouse with the condition that anything leftover in the trust upon your spouse’s passing, known as the remainder, will pass down to your children. This can provide financial relief to your children and grandchildren, as well as peace of mind.
Craft the thorough estate plan that you need
We know that thinking about your own mortality is tough. But we think that you’ll find a burden lifted from your shoulders once you create a sound estate plan. If you’d like to discuss the matter further to discover what an estate plan can do for you and your family, consider giving a firm like ours a call.