Adding Step Children to Your Estate Plan

by Suzanne Powell

As we look ahead to a new year, we think of our goals and priorities. Some of these goals can involve getting an Estate Plan together. If you want to leave part of your estate to your stepchildren, you must make this specification in your will. If a stepparent dies without a will, the children will not get any part of the estate even if the deceased stepparent wanted them to. Stepchildren do not have automatic inheritance rights possessed by adopted and biological children.

Legally speaking, stepchildren are not entitled to any inheritance unless they are specifically named on the will. This fact can be traced back to the colonial days when America was under British common law. Due to the prevalence of negative stepparent stereotypes at the time, the centuries-old legal system did not encourage strong legal relationships between stepchildren and stepparents.

Blended Families and Estate Planning

What are blended families? The term blended family refers to a family situation where either the husband, wife or both, have children from a previous marriage. Blended families can take any of the following forms.:
– Families where both spouses have children from an earlier marriage.
– A family where the husband and wife have children from previous marriages and biological children as a couple.
– Married couples where either the husband or the wife have children from an earlier marriage.

Blended families often have to deal with complex issues when it comes to estate planning. Problems can arise between the parents or the children and their spouses. Some of the challenges individuals from these families face include:
– Scuffles over the division of responsibilities or authority.
– The need to protect their estate from previous spouses.
– Potential delaying of the stepchildren’s asset perhaps until the death of the parent’s spouse.
– The possibility of stepchildren being disinherited by the living spouse.

Estate Planning Asset Protection Strategies to Protect Stepchildren

The number of blended families continues to rise as divorce rates in first marriages, and remarriages grow. On average, about 50 percent of marriages and 60 percent of remarriages end in divorce in the US. With the help of an estate planning attorney, these families can develop some form of asset protection to make sure that the surviving offspring remains a part of their estate.

Stepparent Will

The stepparent should make sure they have a will that specifically names the stepchild/children as a beneficiary. If a stepparent dies without a will, his/her estate will be inherited by the legal spouse or the closest living relative but not the stepchild.

Irrevocable Life Insurance Trust (ILIT)

ILITs allow stepparents to provide for their children through life insurance and use the remainder to provide for their spouse. The parent purchases a life insurance policy using the child’s name and pays the premium for the rest of his/her life. The child will receive the inheritance upon the death of the parent. An irrevocable life insurance trust is an excellent way to ensure that stepchildren are not disinherited.

Bloodline Trusts

A bloodline trust is intended to benefit your child and his/her offspring. The trust protects a child from creditors and former spouses by keeping the money in the family. The child is the trustee.


Website designed & developed by Agent Refined.