Ok, granted, this topic brings together two things we don’t really like to think about: the competing responsibilities toward spouses and children from past and current relationships, and the possibility we might die. However, if you do ﬁnd yourself in a blended family (basically, any family where one spouse or partner has kids by another relationship), it is particularly important that you have a Will.
Estate litigation led by blended families is on the rise. But more importantly, the default position under Victorian law doesn’t automatically take into account the increasingly complex nature of families. For example, the law invalidates all gifts to a previous spouse outlined in a previous Will
following a divorce. Additionally, sometimes remarriage can invalidate an entire Will.
In other words, the absence of a Will in a blended family not only leaves open the possibility that someone you care about will not share in your estate but also that your loved ones may turn to lengthy, costly and emotionally strenuous litigation in the absence of clear guidance from a Will.
To ensure that all the important people in your life - not just those recognised at law - receive a share of your assets after you die, a Will divides your estate in accordance with your wishes. Moreover, it can ensure this division is done in the most tax effective and strategic way possible.
Here are some things to consider in preparing a Will that addresses the needs of a blended family:
1. How will you divide your assets? The Will is your opportunity to state how your assets will be divided between all of past and present spouses, children from previous and current relationships, and stepchildren. (Remember, if not explicitly stated, some of these people may not be legally empowered to gain anything. Similarly, if not properly accounted for, some
parties may feel the need to challenge the Will in court).
2. Whose assets are whose? For example, any assets (including accounts) co-owned with a previous or current spouse will automatically pass to this spouse (the joint owner) upon your death regardless of your intentions. This needs to be taken into account both when making purchases with a new spouse as well as when gifting joint assets.
3. Will you gift ‘use’ or ‘ownership’ of the assets? For some families, this distinction can be helpful in looking after your different loved ones, for example by giving ‘use’ of assets to a surviving spouse during their lifetime but passing on beneﬁcial ownership to your natural children.
4. How can you protect your beneﬁciaries? For example, some government beneﬁts can be lost when a beneﬁciary receives an inheritance. Others may have unique tax or personal circumstances that make a testamentary trust appropriate. You may want to ensure that any young children have access to funds for their education or benefit as they are growing up.
5. Finally, what else might need to be organised? Some structures, like trusts and companies, can sit outside your will. These may need their own arrangements. Similarly, you may want to think about appointing an Enduring Powers of Attorney to clarify exactly who you would want making financial and medical decisions on your behalf should you lose capacity.
Nest Legal Wills are a fixed fee, including for blended families. You can get started by providing instructions via our secure forms at any time. Once you complete your instructions, you can book in a time for a Skype conference. We'll send you draft documents 24 hours before the conference and we'll talk through every aspect of the Wills then send them to you. Too easy.