Cautionary Tales - Blended Family Guide to Estate Planning - Episode 223

Hey there, Legal Tea Listeners –This is your host, Jenny Rozelle! Today’s episode of Legal Tea is the “cautionary tales” topic. And on these “cautionary tales” episodes of Legal Tea, we normally talk about real-life cases with real-life clients that are things me or my office have worked on -or they are things that I think are generally good things to be aware of, that way you don’t turn into a cautionary tale on my Legal Tea podcast one day! So… for today’s episode, it’s about blended families and how that “type” of family is so ripe for fighting, bickering, and the claws coming out – and I’m not saying there are NOT success stories, but in my experience, I have seen that their fighting tends to get extra ugly, extra quickly. So, today I’m going to first define what I mean by “blended family” then share a story about one, and wrap things up with what can be done to protect things from fighting (but sometimes, people are just going to … fight). So yeah, that is today, my friends, let’s dive in…

What is a blended family? At least for the sake of this episode, this is what I’m using - A blended family is what happens when two people who already have kids from previous relationships decide to build a life together. You know, maybe they have been through a divorce, a breakup, or lost a partner, and now they are starting fresh with someone new—but they are bringing their children along for the ride.

And look, these families come in all shapes and sizes. Sometimes both partners are bringing kids to the table, so you have got a household full of stepsiblings who might not share any DNA but are suddenly living under the same roof (or are older, but still they’re stepsiblings). Other times, one partner has kids and the other does not, so they are figuring out this whole parenting thing for the first time with children who already have a full history and another parent in the picture. And then plenty of blended families decide to have kids together too, adding half-siblings into the mix. What makes blended families so complex—and honestly, so interesting—is all the layers involved. It can be a bit messy, It can be a bit complicated, but it is also increasingly common, and for millions of families today, it is proof that family is about way more than just biology.

So, let me share a story to set this episode up – Meet Bob and Sandy. Bob had kids, Sandy had kids – but Bob and Sandy never had kids together. Initially, all the kids got along fine-ish. I mean, they were not best friends, but they were amicable and had holiday gatherings together and all that jazz. Well, fast forward time, Sandy starts developing some cognitive impairment and then a bit more time later, Bob ends up passing away. In this hustle bustle, a few estate documents were signed by Sandy – 1) not with the attorney who did their joint plan and 2) after Sandy had started showing signs of cognitive impairment. Walls started going up and next thing we know, they are on the brink of war.

We tried to intervene, help this family get on the same page and figure things out, but were met with “I’m NOT attending a meeting or joining a call if SHE is on there” kind of thing. So, we ultimately said … “Okay, we are trying to help your family not erupt into war, try to help your family get moving in a better direction, and ultimately try to help you family from ending up in litigation and spending thousands and thousands of dollars.” Of course, we said it more professionally and respectfully than that – but that was the message. Basically, that went in one ear and out the other … and I can only assume they will be in litigation land.

I often say that with blended families, big life events are often the “test” to see how things go – whether it is incapacity (like Sandy’s gradual cognitive impairment) or whether it is death (like Bob’s passing). Those big life events are when true colors are shown and how the family is going to get through things. And in my experience, a lot of blended families, even though they are showing up to holiday gatherings and stuff, they still feel this simmering feeling of “that’s not my REAL sibling” or “I’ve never REALLY liked them, trusted them, whatever.” The distrust just kind of hangs out in the corner, until boom … something happens, their relationship gets tested, and often … that is when they end up fighting.

So, what can be done through estate planning to try and prevent fighting? Let’s talk about it…

First and foremost, it is absolutely critical to do an estate plan – too many people out there do not do any documents – so hear me loud and clear,, actually DO an estate plan because it one of those areas where a little proactive work can save your loved ones from years of heartache and conflict. The reality is that blended families have competing interests built right into their structure—your kids want to make sure they are taken care of, your spouse's kids are thinking the same thing, and meanwhile you and your partner are trying to be fair to everyone while also protecting each other. Without clear, carefully crafted estate planning, you are basically setting up a situation where people are going to feel hurt, left out, or cheated after you are incapacitated or gone. The default laws in most states were not designed with blended families in mind, so if you do not create your own plan (to override those default laws), the state's plan probably is not going to reflect what you actually wanted. This is where you need to get really specific and intentional, and honestly, it is worth investing in a good estate planning attorney who understands the unique dynamics.

One of the smartest moves you can make is appointing neutral third parties or professionals to serve in key estate roles like executor, trustee, or personal representative. When you are dealing with a blended family, emotions run high after incapacity hits or after a death. Even with the best intentions, there is inherent conflict when someone has to choose between their own interests and someone else's. A professional fiduciary, trusted family friend, or attorney can step in and execute your wishes without the emotional baggage or perceived bias. Yes, it costs money to hire a professional trustee or executor, but that cost is often far less than the legal fees and family destruction that come from contested estates and bitter disputes. These professionals can make the tough calls, handle the paperwork, and serve as a buffer between family members who might otherwise be at each other's throats.

You also need to provide crystal-clear, specific instructions about what happens at the first death versus the second death, because this is where blended families often fall apart. Many couples want to take care of each other first—making sure the surviving spouse has enough to live on—but they also want to ensure their own biological children eventually inherit. This requires really explicit planning. For example, you might specify that at the first death, certain assets go directly to your children (maybe a portion of life insurance proceeds, retirement accounts, or specific personal property), while other assets flow into to the spouse or into a trust for the surviving spouse to use during their lifetime, with the remainder going to your kids when the survivor dies. Or maybe everything goes to the survivor, but only if they agree to certain conditions. The key is spelling out exactly what you intend so there is no room for interpretation or assumptions. If you want your spouse to have the house for as long as they need it but then want it to go to your daughter, say that explicitly. If you want your son to get your coin collection immediately, put that in writing. Ambiguity breeds litigation.

Here is a big one that many people do NOT consider: you should seriously consider making your estate plan irrevocable at the first death, or at least locking in the ultimate beneficiaries so the surviving spouse cannot change them. Let's say you and your spouse create a joint plan where you leave everything to each other, and then after both of you are gone, everything gets split among all the kids—yours, theirs, and any you have together. Sounds fair, right?

But here's what can happen: you die first, and your spouse remarries or has a falling out with your kids or simply decides they want to leave everything to their own biological children. Suddenly your kids are completely cut out, and there is nothing they can do about it because your spouse now owns everything and can change the beneficiaries. By making the plan irrevocable at first death—or at least irrevocably designating the final beneficiaries—you ensure that your wishes are honored even after you are not around to enforce them. This likely means using trusts that continue after the first death with locked-in remainder beneficiaries, or it might mean owning certain assets separately and directing them specifically to your own children. It becomes an elaborate strategy, but if you put the time, money, and energy into a good plan – it lessens the likelihood of fighting.

Beyond what I have already talked about, there are a few other strategies worth considering. First, be really thoughtful about life insurance—it is one of the cleanest ways to provide for your biological children without taking assets away from your spouse, since the death benefit goes directly to the named beneficiary outside of probate. Second, do not forget about communication. As awkward as it might be, having a family meeting where you explain your estate plan (at least in general terms) can prevent a lot of hurt feelings and conspiracy theories later. People are much less likely to contest a plan when they heard the reasoning directly from you. Third, update your beneficiary designations on retirement accounts, life insurance, and payable-on-death accounts to match the overall plan and strategy—if you forget to update them, they can undermine your entire strategy. Finally, consider putting some of your reasoning in writing, maybe in a letter to your family explaining why you made the choices you did. It may not prevent every dispute, but it can provide context and reassurance that your decisions came from a place of love, not favoritism or spite.

Alrighty, let’s shift to a sneak peak of next week, which we’re circling back to the “current trends” topic where we talk about things that are going on currently that impact my estate and elder law world – or maybe, things that I have stumbled upon on the news or social media that is relevant to this podcast. Next week will be the Tuesday before Thanksgiving and I have something fun up my sleeve talking about the intersection of inheritances and pumpkin pies – you may be thinking, “What in the world? How is she going to bring those together?” You just wait, my friends. Until then, Legal Tea Listeners, be well and talk soon!

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