If you want to protect your assets that you leave for your spouse and children from your husband’s new wife, you need comprehensive, up-to-date estate planning, trust planning. If you leave your assets outright to your husband, or own assets jointly with him, your children will likely be disinherited.
Sadly, this is how it happens,
Penelope and Paul have been married for 25 years; they have four children. They own most of their assets jointly and have named each other as beneficiaries of retirement plans and life insurance policies.
What will happen when Penelope dies?
If Penelope dies first, all of her assets will pass automatically to Paul. As the surviving owner of jointly owned assets and the designated beneficiary of contract assets, he gets all of the assets outright.
All is well, until Paul remarries.
When he remarries, he puts the assets that once belonged to he and Penelope in joint name with his new spouse, Candy. In addition, Candy is the designated beneficiary of the contract assets, Paul’s retirement assets and life insurance policies.
What will happen when Paul dies?
Candy will inherit all and Penelope and Paul’s children will inherit nothing. Their children, and grandchildren, won’t even be legally entitled to choose a family heirloom to remember their parents by.
Unfortunately, this scenario plays out all of the time. Children are unintentionally disinherited. If assets pass to a second spouse, they will not get to children from a previous relationship. If you wish to avoid having your children disinherited, you can do so with comprehensive estate planning, trust planning. Be sure to consult with a qualified estate planning attorney and avoid joint ownership. Name a trust as the beneficiary of your life insurance and retirement accounts.
- Donor Advised Funds: Too Good to Be True? - September 15, 2021
- Changing “Irrevocable” Trusts Through Judicial and Nonjudicial Modification - September 8, 2021
- Reasons to Supplement Your Estate Plan With Life Insurance - September 7, 2021
