{"id":841,"date":"2017-10-30T19:36:56","date_gmt":"2017-10-30T19:36:56","guid":{"rendered":"https:\/\/www.jacksonwhitelaw.com\/arizona-estate-planning\/?page_id=841"},"modified":"2024-10-04T21:18:16","modified_gmt":"2024-10-04T21:18:16","slug":"wills-second-marriages-children","status":"publish","type":"post","link":"https:\/\/www.jacksonwhitelaw.com\/arizona-estate-planning\/blog\/wills-second-marriages-children\/","title":{"rendered":"Wills For Second Marriages With Children"},"content":{"rendered":"<h2>Introduction<\/h2>\n<p>A second marriage can be a wonderful event, but when the union involves spouses with children from a previous marriage, merging finances can be tricky. The value of each spouse\u2019s assets is rarely equal, and while the commitment to each other is unquestionable, the commitment to financially provide for step-children after a spouse\u2019s death is often cause for concern. Balancing the desire to provide for your new spouse without jeopardizing your children\u2019s inheritance, and while providing for your new spouse\u2019s children, can be a challenge.<\/p>\n<h2>Begin with candid conversation<\/h2>\n<p>Before you sit down with an estate planning professional to find a solution, start by having a candid conversation with your new spouse. It may be awkward and uncomfortable, but being on the same page is essential. Try to address questions such as:<\/p>\n<ul>\n<li>What financial or contractual obligations (divorce agreement, alimony, child support, etc.) do you have from your previous marriage?<\/li>\n<li>What assets are you bringing to the marriage? Which of those assets are intended to share, and which, if any, are intended for your children?<\/li>\n<li>What are your long term financial goals?<\/li>\n<li>How would you prefer your share of the estate to be distributed when you die?<\/li>\n<\/ul>\n<h2>Formulate an estate plan<\/h2>\n<p>Once you are both on the same page and have outlined your goals, create an estate plan with the help of a professional. Any assets that are intended for your children should be retained individually, while assets intended to provide for your spouse can be transferred to joint ownership accounts. Accounts and property designated as joint tenancy with right of survivorship will seamlessly pass to your spouse when you die; individual accounts with transfer-on-death (TOD) or payable-on-death (POD) designations will pass to the beneficiaries listed on the account.<\/p>\n<h2>Draft a will<\/h2>\n<p>A <a href=\"https:\/\/www.jacksonwhitelaw.com\/arizona-estate-planning\/services\/wills\/\">will<\/a> is an integral part of the estate planning process, and is especially important regarding second marriages with existing children. The will, or testament, is the document that formalizes and legalizes your estate plans. Without it, your estate will be subject to <a href=\"http:\/\/www.azcourts.gov\/Portals\/83\/pdf\/UniformProbateCode2006.pdf\">probate<\/a> when you die, and your estate will be distributed according to the state\u2019s <a href=\"https:\/\/www.azleg.gov\/ars\/14\/02102.htm\">intestate succession<\/a> laws\u2014regardless of your final wishes.<\/p>\n<h2>Use a mutual will to direct your estate<\/h2>\n<p>The simplest solution involves drafting mirroring wills, known as mutual wills. Each will offers identical instructions, usually transferring all assets to the surviving spouse, and ultimately to your children. Regardless of which spouse dies first, the process will be the same.<\/p>\n<p>The challenge with mutual wills is that they rely entirely on faith. When the first spouse passes away, the surviving spouse can amend their will, effectively disinheriting the former spouse\u2019s children. Even if your will expressly forbids this, once you transfer your assets to your spouse and your estate is closed, you lose the ability to direct the assets. It will be entirely up to your spouse to honor your request.<\/p>\n<p>Many people have no problem with this and ultimately decide that mutual wills are the best solution to provide for their spouse and children. However, for those who are uncomfortable and require additional certainty, a trust is a viable option.<\/p>\n<h2>Use a Trust to Protect Your Children\u2019s Inheritance<\/h2>\n<p>A <a href=\"https:\/\/www.azleg.gov\/ars\/14\/10404.htm\">trust<\/a> is a legal agreement that allows a neutral third-party, known as the trustee, to hold and manage assets on behalf of the agreement\u2019s beneficiaries. Assets transferred to the trust will be administered according to strict instructions, and cannot be altered after your death. Where your spouse can alter the ultimate distribution of assets transferred directly to them, they would not be able to modify the terms or beneficiaries of the trust.<\/p>\n<p>For example, let\u2019s say your will instructs that upon your death, your assets be transferred into a trust for the benefit of your spouse, with your children listed as remainder beneficiaries. As long as your spouse lives, the assets within the trust will provide for her; when she passes away, the remaining assets in the trust will be distributed to your children. Of course, your spouse will have identical instructions in their will. If they pass away before you, a trust will be created for your benefit, and upon your death the trust will pass to your spouse\u2019s children.<\/p>\n<p>Note that while this can resolve most issues, the plan isn\u2019t perfect. If your spouse drains the assets in your trust, there would be nothing left to distribute to your children when your spouse dies. There have been cases where a spouse uses trust assets for income and support while carefully preserving their own assets, ensuring that their children will receive a larger inheritance at the expense of your trust\u2019s remainder beneficiaries.<\/p>\n<h2>Revocable vs. Irrevocable Trusts<\/h2>\n<p>When considering the use of a trust in your will, it\u2019s important to understand the difference between revocable and irrevocable trusts. Revocable trusts can be amended or dissolved as long as the trust-owner is alive; irrevocable trusts can only be amended with the permission of the trust\u2019s beneficiaries. For example, if you create a revocable trust for the benefit of your children and transfer $100,000 to the trust, you have the right to retrieve those funds, in full or in part, up until the day you die, at which point the trust will transition to an irrevocable trust. If, on the other hand, you create an irrevocable trust for your children\u2019s benefit and transfer $100,000 to the trust, you cannot take back the funds without your children\u2019s permission.<\/p>\n<h2>Additional Benefits of Using a Trust<\/h2>\n<p>Since assets transferred to an irrevocable trust cannot be reclaimed, they are effectively removed from your personal estate, placing them out of the reach of creditors and lawsuits who may have claims or judgments against your property. The assets are also removed from your estate for the purpose of calculating estate taxes. By transferring a sizeable portion of your estate into an irrevocable trust, you may be able to minimize or even avoid estate taxes.<\/p>\n<h2>Disadvantages of Using a Trust<\/h2>\n<p>While an irrevocable trust can protect against lawsuits, creditors, and estate taxes, it comes with a steep opportunity cost. Once the assets are transferred to the trust, you lose control of the property. If your financial situation worsens, or if legislative changes negate the current benefits of trusts, you may not be able to amend or dissolve the trust. If your estate isn\u2019t at risk for estate taxes, and protection from lawsuits or creditors isn\u2019t a concern, then a revocable trust might make more sense for your situation as it allows you to retain control over the assets and make necessary changes during your lifetime.<\/p>\n<p style=\"text-align: left\">Call our Arizona Estate Planning team at <a href=\"tel:4804674325\">(480)467-4325<\/a> to discuss your case today.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Introduction A second marriage can be a wonderful event, but when the union involves spouses with children from a previous marriage, merging finances can be tricky. The value of each spouse\u2019s assets is rarely equal, and while the commitment to each other is unquestionable, the commitment to financially provide for step-children after a spouse\u2019s death [&hellip;]<\/p>\n","protected":false},"author":21,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"site-sidebar-layout":"default","site-content-layout":"default","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"default","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[12],"tags":[],"class_list":["post-841","post","type-post","status-publish","format-standard","hentry","category-wills"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.9 - 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