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Estate Planning for Blended Families: Balancing Love and Legacy

13 January 2025

In today’s world, blended families—where individuals remarry or form new relationships, often bringing children from previous partnerships—are increasingly common.

While these families bring love and new beginnings, they also present unique challenges when it comes to estate planning. Ensuring a smooth and fair transfer of assets requires thoughtful consideration and skilled legal advice.

The First Step: Property Ownership

One of the first financial steps in a new relationship is often purchasing a property. How this property is owned can have significant implications for estate planning:

• Joint Tenants: Many couples choose to hold property as Joint Tenants, which ensures the property automatically passes to the surviving partner upon death. While this arrangement simplifies the process, it bypasses the terms of a Will. For example, if you intend to leave a portion of your estate to children from a previous marriage, this arrangement could unintentionally exclude them.
• Tenants in Common: Alternatively, holding property as Tenants in Common allows each person to own a defined share of the property. This share becomes part of their estate and can be distributed according to their Will, ensuring children or other beneficiaries are not overlooked.

Balancing Interests with Trusts

A well-crafted Will can balance the needs of a current partner or spouse with those of children or other loved ones. One effective tool is a Trust.

• How Trusts Work: A Trust can grant a surviving partner the right to live in the property for a set period or even for life, while preserving the underlying value of the property for children or other beneficiaries.
• Advantages of Trusts: This approach protects the surviving partner’s housing security while safeguarding assets for future generations.
• Challenges with Trusts: Trusts require careful planning. The survivor may feel restricted by the terms of the Trust, especially in long-term relationships, leading to potential disputes. In some cases, surviving partners have pursued claims under the Inheritance (Provision for Family and Dependants) Act 1975, arguing that the Trust’s provisions are unfair.

The Role of the Courts

When disputes arise, the courts aim to determine what is reasonable, rather than purely fair. While there was once a trend favouring surviving partners or cohabitees over Trust provisions, recent case law has reinforced the validity of carefully drafted Trusts in many situations. However, every case is unique, and outcomes depend heavily on individual circumstances.

Why a Will Is Essential

Regardless of whether you use a Trust, creating a Will is crucial - especially when purchasing property. Without a Will, your estate will pass according to the rules of Intestacy, which may not align with your wishes:

• Married Couples: Under intestacy laws, a surviving spouse may inherit the entire estate, potentially excluding children from a previous marriage.
• Unmarried Couples: Surviving partners who are not married or in a civil partnership are not entitled to any inheritance under intestacy rules.

A properly drafted Will ensures your estate is distributed as you intend, preventing confusion and potential disputes.

Early Advice is Key

Estate planning for blended families is complex, requiring careful thought and expert guidance. Starting the process early allows you to create a plan that balances the needs of all parties, minimises conflict, and provides peace of mind for your loved ones.

If you’re navigating these decisions, our team is here to help. Contact us today for personalised advice tailored to your family’s unique circumstances.

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