In today’s society, family structures are more diverse than ever, with many families blending through remarriages and de facto relationships. However, this modern dynamic can lead to complications when it comes to inheritance, particularly for stepchildren.
It is not uncommon for a parent to pass away and leave their estate to a partner or spouse, trusting that their new partner will make provisions for the deceased children in their own will. However, this trust can unfortunately sometimes lead to disappointment, as many partners do not include stepchildren in their inheritance plans. Even when the wills are drafted together and all children and stepchildren and catered for, life can change, and the remaining person may enter into a new relationship and change their will, or dilute the share of the stepchildren.
This oversight can leave stepchildren feeling excluded and vulnerable, especially if the new partner prioritises their biological children or new partner. The emotional and financial implications of such decisions can be profound, resulting in disputes and heartache during what is already a difficult time for families.
To ensure that children are adequately provided for by a stepparent, proactive estate planning is essential. Here are some steps to consider:
Open communication: It is crucial for families to have open conversations about inheritance and estate planning. These conversations can clarify intentions and reduce misunderstandings, fostering a sense of security for all family members.
Create a will: A well-drafted will should explicitly state the intentions of the deceased regarding their asset distribution. If a parent wishes to provide for their stepchildren, this should be clearly outlined to avoid any ambiguity and ensure their intentions are honoured.
Consider a contracting out agreement: In New Zealand, a contracting out agreement can be beneficial in ensuring that all parties understand and agree on how assets will be managed and distributed. Such agreements are particularly useful in blended families, protecting the interests of stepchildren while promoting clarity and fairness (read more here).
Review and update estate plans regularly: Life circumstances can change rapidly, making it important to revisit estate plans regularly. This ensures that documents reflect current relationships and intentions, particularly after significant life events such as marriage, divorce, or the birth of new children.
Provide for your children directly: There are many ways to provide for your children without leaving your new partner homeless. Options such a life interest are often used to ensure your partner has the benefit of living in a property, but your children will receive their share later.
Seek professional advice: Consulting a legal expert who specialises in estate planning can provide essential and valuable guidance. We can help navigate the complexities of inheritance laws and ensure that all family members, including stepchildren, are considered in the planning process.
The modern family landscape requires thoughtful consideration when it comes to estate planning. Don’t leave things to chance - take proactive steps to ensure that all family members, including stepchildren, are fairly treated in matters of inheritance. By engaging with an expert during estate planning, families can understand their options and create a clear and fair distribution plan that honours the relationships and responsibilities that come with blended families. This careful approach not only protects stepchildren but also fosters harmony and understanding among all family members, helping to prevent disputes and maintain family unity during difficult times.
This article is intended for informational purposes only and should not replace specific advice. For personalised advice on estate planning please contact us.
This article was accurate at the time of publishing.
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