Writing will 'blended family'

[willymcwill]

Hi,

Dh and I are (finally) getting around to writing our wills. We have a dd and a ds on the way. I have two ds from my previous marriage who live with us full time.

Both dh and I are high earners; we both came into the marriage with very similar (small) assets, and have been very successful since. Exh (father of ds1 & ds2) has low paid job with low value house. No idea of life assurance etc for him.

Dh and I have a high value house, and high value life assurance policies, as well as other assets.

Dh wants his assets to be protected so that his biological children benefit in the case of his death (whether he predeceases me or not). I want the same for all four of my children, but particularly want to ensure that ds1 & ds2 will benefit from my assets if I predecease dh. We both want to ensure that the children are protected in case of remarriage by either of us.

So far we think that a 50/50 split of the house (so change to tenants in common) with a life interest trust for the house would ensure that the house as an asset is fairly distributed whilst still protecting the surviving spouse.

It is the other assets that are trickier. There is one life assurance policy that I have, which I took out when ds1 & ds2 were small, with both exh and I as life assured, which was novated to me (to benefit the dc) which would go directly to them. And my overall life assurance is larger than dh's. But if we split all of his policies three ways (so between me and dc3 & dc4) and mine five ways (between him and all four children), and included the single policy and the house, the inheritances of dc1 & 2 are roughly half that of dc3 & 4, which makes me feel guilty. I know that dc1&2 will be 'dependent' for a much shorter period than dc3&4 (there will be 13 years between dc1&2) but their pot will be much smaller, and they would have a large delay on the house-related inheritance as we wouldn't want the house sold (even if we were both to die) until dc4 was of an age (not decided how old... 18/25???)

Sorry for the long post, it is all quite complicated but we wanted to at least talk it through ourselves before seeing a solicitor. I just feel guilty that dc3&4 will benefit much more than dc1&2, but tweaking the splits much more make dh feel that it is unequal to the younger two.

Oh and just so I don't drip feed, exh's parents are already deceased so no inheritance or help from them, and exh has already said that he has no willingness to save for their university education! He pays minimal maintenance, which I have never pushed as I would rather be independent of him, but it does make me worry if things aren't formalised to ensure that they are protected in case of anything happening to me.

I'm afraid your new H sounds like a dick. It's not ok for you to give all your share to all 4 kids, but him to only look after the younger ones.

I have a blended family, although slightly different to yours. DH and I both have a DS each from previous relationships and one DD together. Our assets will be split 3 ways equally. My DD will only get inheritance from us and the boys will inherit from their other parents so I did wonder whether we should make her share larger but we kept it equal in the end. It's so hard isn't it?

I'm a will writer, and this is a scenario which comes up very frequently.

Often the best solution is the life interest in possession trust which you're already considering, with your share going to all four of your children and your husband's between the two joint children. The reasons for the disparity in the resulting gifts are firstly that your children are presumably likely to inherit from their father's side, (I hear what you say in that regard but if he doesn't remarry or have any future children, they're likely to inherit either by a will or under the intestacy laws) and secondly that they will be financially dependent for less time than the younger ones.

In terms of the other assets, what you are proposing is perfectly fair and standard practice in these circumstances.

I suggest that the way you approach it in the first instance is to bear in mind that things will change when the younger children are adult.

So my best advice is to put in place wills which provide "good enough" provision for all of the children right now, and then change them when the younger children are 18/21ish so that at that point, all of the children receive roughly the same proportions of the joint assets. If your husband still isn't happy about giving his estate to the four children, at least you can split your share between them.

Remember too that death in service benefit and life insurance are usually written into discretionary trusts and aren't dealt with by the wills (this is to avoid IHT being payable on those assets), so you need to ensure that your nomination of benefit forms are up to date and reflect your wishes.

If you want any more info feel free to pm me.

Thanks (for the majority of the responses 🙄)

I have to respect dh's views, as much as I would love it if he considered all of the children the same; but this is the real world not some fairytale. And he's not exactly an evil stepfather; he takes care of the older two (and has done since they were pretty small) and has done much more 'parenting' (attending school things, helping with homework, taking them to do fun stuff that I am too much of a wimp to do) than their biological father has.

The inequality (in terms of overall inheritance) does irk me, but I agree that provisions can and should be reviewed regularly. If there wasn't such a disparity between my financial position and that of my ex it would probably not bother me so much; but as it is so different it feels unfair.

Mumble I will pm you; it may be a week or so though as we have got to conclude our discussions on guardianship of dc1&dc2 in case of me predeceasing dh

Hi Willy, no worries. I'm on hols 17 June to 1st July but it doesn't sound as though you're in a desperate rush anyway.

So far as guardianship of the older children goes, I suggest that you try to agree that with their dad, so that you aren't appointing different guardians in your will to the ones he may be appointing in his.

Thanks Mumble. Ideally I'd want dh to be guardian and for dc1&2 to live with him and dc3&4 until such time as they are financially independent, with adequate provision made to ensure that school/uni costs are all covered to take the pressure off. We live quite far from their dad (and my parents, who are pensioners) and they are at school locally, so I would hate for something to happen to me and them have to move schools/houses/away from their siblings not to mention the change in lifestyle. But this is obviously a big thing for dh to agree to...

If you the mother dies then the father even if he does not see much of the children has a right to the children actrually. Eg my letter of wishes with my will said the younger ones would stay with the 10 years plus older 3 children (who with me have brought them up) but my solicitor was very clear that their father in fact could have them if I died (not relevant now they are teenagers really).

If your life insurance is not an endowment policy and just pays out of you die b efore 65 etc then in practice probably it will not be paying out ever but even so it is wise to put it in trust for whatever combination of children you want.

If I remarried I would want my children to inherit everything 100% and nothing to a new partner (not a typical decision),. So not everyone is the same and I would not want my estate to go to adult step children either not least because I have 5 children so everything is spread pretty thinly anyway after IHT is paid on my estate on most of it as I'm single.

If you feel your first 2 children, his step children, will not be fairly treated you could always make more provision for them now I suppose to ensure all 4 get exactly the same when the time comes. It is probably likely your husband will die first (men usually do although my father didn't which surprised him - he always thought my mother would long out live him) in due course so the likely sequence (unless one of you is much older) is when you are both about 80 this will all be relevant.

You also might want to do what I've done. I've been giving the older 3 childreh money first so they graduate without any debt, then to help buy a first property - got my savings back to zero this year doing that, which does not matter as I earn a fair bit and can save again. It also has the advantage that the children get money in their 20s when they need it. Not when they are nearly 60 and don't and it makes it much less likely 40% inheritance tax will be applied toi t. The only downside is if the children divorce their spouse might get the cash but I am happy to take that risk. If you did something like that you could even out the different that migh ultimately come to your first 2 children from not inheriting from their step father. Of course their real father might win the lottery before then and they might inherit £100m for all we know!