Without an estate plan, when we die, our debts are resolved in probate court, and then remaining assets are distributed to heirs, as dictated by state laws of intestate succession. Since the roots of these laws date back to the 1950s, they do not generally account for modern and blended family structures. Proactive estate planning is the best way to avoid unintended disinheritance, and prevent devastating conflicts.
Intestate Succession Vs Family Dynamics
Absent a will or trust, state intestacy laws aim to make asset distribution fair for heirs, but do not take family dynamics into consideration in real time. That’s why unintended consequences stemming from asset distribution via laws of intestacy can hit loved ones hard. To avoid problems, it’s important to understand the basics of intestate succession, and experts at FindLaw share this overview:
All fifty states have intestacy laws…although they vary … .The purpose of intestate succession laws is to distribute the decedent’s estate in a manner that closely represents how the average person would have designed their estate plan if they had one. However, these laws can differ dramatically from a decedent’s wishes for distribution. For instance, someone may prefer to leave assets to charities or friends. However, intestacy laws do not provide for these distributions.
The Uniform Probate Code (the Code) is the starting point for many states’ laws. Under the Code, close relatives inherit before distant relatives. The classes of relatives whose members receive property under the Code include the following:
- your surviving spouse,
- your descendants (children, grandchildren, etc.)
- your parents
- the descendants of your parents (siblings, nieces, and nephews)
- your grandparents
- the descendants of your grandparents (aunts, uncles, and cousins).
With a basic understanding of the laws of intestacy in mind, it’s easy to see how money, prized possessions, real estate and other assets can end up going to “the wrong person.” For example, what if you have a life partner but are not married? What if you have no children? What if you have both biological children and step children? What if you really wanted an exceptionally kind neighbor to receive that antique collection? Absent a will or trust, these kinds of questions will be purely resolved via intestate succession laws, with distribution overseen through probate court. As D.S. Law observes: “In blended families, traditional assumptions about inheritance often don’t apply. Without a clear, customized plan in place, loved ones can unintentionally be left out, or worse, family conflicts may arise.” Accordingly, it’s especially wise for blended families to proactively address these estate planning challenges:
- Unintended Disinheritance
Without a proper plan, a surviving spouse may inherit everything, leaving children from a previous relationship with nothing after the spouse passes.
- Tension Among Heirs
If expectations aren’t clear or fair, relationships between step-siblings or with stepparents can quickly become strained.
- Guardianship and Custody Concerns
For minor children, who will be responsible for them if something happens to both biological parents? A stepparent doesn’t automatically have legal rights.
- Healthcare and Financial Authority
Who should make medical or financial decisions if you become incapacitated? A new spouse, a child from a previous relationship, or someone else?
Estate Planning Basics for Blended Families
Ready to get started? These estate planning basics will help you move into action. In preparation for talking to an estate planning attorney, you’ll find it useful to make a list of all your assets, be they few or many, and these tips may come in handy. Blended families will also want to consider questions like these:
- Will your assets be divided equally between biological and stepchildren?
- Do you want your spouse to inherit everything, or should certain assets go directly to your children from a previous relationship?
- How can you ensure your spouse is financially secure without disinheriting your children?
When you make an estate plan, you will designate a loved one, friend, or professional to carry it through. This person is generally referred to as an executor, trustee, or personal representative, depending on your circumstances and region. Regardless of the specifics of your estate plan, the individuals you appoint will be considered fiduciaries—meaning they are legally obligated to carry out your affairs, in accordance with the intentions set forth in your estate plan, and the law. When representatives are designated, fiduciary bonds, alternatively referred to as estate bonds, can be required as a safeguard for the interests of the estate and beneficiaries.
Colonial Surety Company offers this information to help you understand how estate bonds work. As you develop your estate plan, remember Colonial makes it easy and speedy to obtain any type of estate bond, and meet the bonding requirements in every state. At Colonial, the steps to obtaining estate bonds, and all other types of fiduciary bonds, are simply: get a quote online, fill out the information, and enter a payment method. Print or e-file the bond from anywhere—even the law office or probate court.
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