Talk to me about blended families and Wills

[candlelightsatdawn]

Hi all

We are looking at revising our wills because currently they aren't reflective of new DC and new assets and we need to update them. With pandemic and other medical issues we just haven't sorted it.

We both have a DD each, both me and DH have a SD and a new joint baby (hopefully) soon. How have you all done it ?
I have been speaking to a friend who's having a massive issue re the SC/ex wife contesting the will and after hubby has passed and it's given me a kick up the rear to look at it from all angles.

If it helps when we bought house together I bought £100,000 equity and he brought £45,000. We pay equally towards bills bar a expensive horse that is completely my bill as he's lovely but a costly little thing.

How have you all worked it ?

Ring fence deposits, equity 50/50. We have no joint children so simpler - his money is his, mine is mine but we have lifetime interest in the house. Pension I'm named beneficiary but anything left goes to his dd, I don't have significant pension in my name, my ex's pension which I receive goes to my kids due to scheme type

The way I think is fairest is that your half is split between your children and DH’s half is split between his children. In your case that would mean 25% going to each of the two children from a previous marriage and 50% to your joint DC (assuming no more future children).

Alternatively (especially if the older children are not likely to inherit anything from their other parent) you could just split three ways.

This is assuming you and DH have mirror wills and one of you doesn’t die significantly earlier than the other one. You also need to consider what would happen if you leave all your money to DH, assuming he'll leave his will so that it benefits the kids as planned, and then he marries again and changes his will to leave all the money to his new wife. Your DC can lose their inheritance in this situation. So you may want to set up trusts to ensure the money goes to your DC.

You need to carry enough life insurance so any maintenance payments could continue to ex-spouses, children. That's step one. My half our assets is split between my children. DH's half of the assets is split between his children including our joint children. Keep in mind that if you do explicitly set it up to go into a trust on your death and everything goes to the remaining spouse they can rewrite their will however they like. Lots of children of first families lose out this way.

We dealt with the issues of estate planning by going to see attorneys who specialized in estate planning.

@IgneousRock I believe this is something that comes up a lot actually I won't be leaving it all to DH but I also don't want him to be turfed out should I die esp if children are younger. Which is what's happening to my pal, we will mirror wills.

The problem being even though I really get on with HB ex is she is hands down someone who will contest will and would no doubt advocate SD to do the same ( she's historically done it two family wills so far)

I'm leaning towards us each splitting it to each of biological children inheriting from each bio parent and therefore it's straight down the line, DH is saying just do equal split. Which if he's ex wasn't as inclined as she is, it would be fine but that's not the cause since he's likely to die before me (statically speaking no one knows for certain) I just don't want the headache of logistics or hassle.

Neither my DD or DSD are likely to inherit from either other parent because of their parents views re money (aka I'm not leaving anything because I'm going to live a full life) which is fine and works well as there's mirroring going on there as well.

I suppose want to know what potential pitfalls we may come across.

Sorry for such gloomy topic ladies (and gents)

@Deisogn ohhh maintenance now that's something I hadn't considered actually thank you for this point !

Whomever was receiving maintenance will have a claim against the estate for continued support. You need to account for it.

We are in the exact same position, but with boys. So i have a son (19) from my first marriage and my husband has a son (also 19) from his first marriage and we have a son (15) between us as well. We have been together since the older boys were 2 and my SS has always lived with us and i have parental responsibility for him, he sees his real mum only a couple of afternoons a year. So for all intents and purposes they are 3 brothers that live together in the family home.

We are splitting everything 3 ways equally. We don't feel that the older boys should be penalised and get less from us just because they have another parent floating about somewhere they could potentially inherit from as well (or not as the case may be). That other parent could win the lottery or go bankrupt and for us, its not something that should be taken into consideration in the event of our deaths, its nothing to do with us. Not splitting it 3 ways would cause resentment and disruption between our boys at an already emotional time and i would hate that.

We do have a lot of assets and a shared profitable business, so there is a lot to sort out, but generally its all fair. I came into this marriage with absolutely bugger all whilst DH had a large house mortgage free, but we are still sharing the lot equally 17 years later, although that was only decided about 10 years ago. Before that we didn't even have any wills.

DH and I are together, and I still have insurance policies that will leave money to our dc directly. To many stories of dads moving on quickly and the children getting cut out of the will.

I don't want to rely on anyone to make sure my children are provided for. If you do similar for your own 2 children that money would be theirs and not part of anything that can be contested, your DH can do the same if he wants.

DH and I have agreed his assets 3 ways (3 kids) my assets to DD. But it was complicated to make this happen plus the age differences between the kids mean I actually need to secure the majority of our shared assets (our home) to live in. So presently we leave majority to each other and my asset (my Mum's house) goes to DD.
PIL will writes their assets to grandchildren if DH dies before me.

We have a life interest trust- basically when one of us dies our half of the property passes to a trust in the name of our bio DC, but the surviving partner has the right to live in the property for the rest of their life, or sell it and use the money for another property. It works quite neatly for us as we don’t have DC together, and we each put in 50% to the house. But you can do it with different percentages.

We own the house as tennants in common (I put down £100k, DH put down £0.00) so my share will be going to DS, along with my S&S ISA. Life insurance to pay off the mortgage and DH is my beneficiary of work life assurance etc etc. DSD is named in my will to receive a portion of my jewellery, some of which she's already chanced her arm and asked me for
DH has separate life insurance to cover DSD until she's 18. His share of house comes to me as if he dies before she's 18, about 90% of the equity in the house will have come from me anyway.
We plan to look at this again as her 18th approaches as we don't want her disinherited when the life insurance expires. I imagine at that point he will want to split his share of the house between his children. My share will still go to DS.
The thin go with wills is that most people seem to think about what happens when they die aged 83, but really wills should be reviewed throughout as what is appropriate when the kids are 20 and 10 might not be appropriate when they are aged 40 and 30.

As above, wills for now, but subject to change. I don't have children, but do have lots of nephews and nieces who were young adults before I met DH. This complicates things a bit, and did not go down too well with the DSC when it dawned on them that I do have actual relations!

This post has been most helpful. I think I need to make sure DH had insurance that will cover maintenance until she's 18 and also I suppose on the flip side of that our DC too! As that needs to be maintained for both DC for fairness.

For us at least I think we will do what @Youseethethingis has done as that matches closely to what I was thinking. Thank you for tenants in common I will have a gander.

@SpaceshiptoMars similar issues but less DSD and more the ex.

Aren't wills fun ? May gift horse and leave portion of running costs for horses life to DSC from my estate bit. As that's our shared thing, which DH does 0 for.

This will have to be reviewed in few years as SDC will hit majority and maybe will have more additions to the family by then (who knows if I survive this one first) !

It's a tricky one because there's also an emotional element no matter how hard you try to think of it as a financial thing. Speak to a solicitor, it can get tricky.

Definitely use a specialist - a lawyer who is a STEP member.

Lifetime interest in house, ringfence deposits, your biological children get half each from each parent. Provision if Dh pays maintenance and also something which protects your preferences if you die first.

The fact that both other parents are unlikely to leave anything shouldn’t matter. Good luck!

If you’ve a child each and a joint child then IMO you split 3 ways. Inheritances from other parents are irrelevant as they are not your family and anything can happen with them.

@Oneforthemoneytwo

If you’ve a child each and a joint child then IMO you split 3 ways. Inheritances from other parents are irrelevant as they are not your family and anything can happen with them.

I disagree as one partner may have family money etc. I think the starting point should be each parent should split between their own children equally unless any extenuating circumstances.

@MeridianB ohhh STEP member didn't know this existed ! Thank you for the tip.

And agreed I don't expect DH to leave any provisions for my DD as she has two parents so anything he leaves is a nice to have but certainly not something expected .That in reverse applies to DSC with me but I will probably leave the horse ect (I don't know if I can do that actually will find out)

@CloudyStorms these things I think are probably as emotional as people make them. I won't be trying to make up for any lacking on her DM part financially if her mum doesn't want to make provisions for her to make it fair, the split just by the nature of what I have brought to the table vs DH will mean the amounts will different . DSC has two parents and I can only hope her mum does what's best for her child, such as I can hope my ex does for his DD and his will, it's not within my control nor do I wish to take on that financial monkey. However by that same token I won't let DH split what he has 3 ways when realistically he should only have to split it two ways (via his bio children) as that will reduce the amount both get.

Thanks all for the advice

@candlelightsatdawn yes I think whatever my DH's ex does should have nothing to do with what me and him do with our wills. Same as my income is nothing to do with her (despite her protests). I bring more to the table financially so our shared DC is the one who should benefit from that IMO.

Oh and if you do choose to put things in trust etc make sure the trustee is someone you know has your child's interest at heart. We were going to choose one of DH's relatives until they started complaining how unfair it was we had taken DC away without the DSC, it showed they didn't get the nuances of stepfamily finances.

@CloudyStorms oh god not you too ! I thought it was just me that had this type of ear ache from DH ex over my income.

I said I was getting a pay rise in a few weeks so would be able to sort something out for DH she overhead said "oh goodie pay rise for me too" and I really hope she was joking 🙃

I never discuss finances around her or the kids but yes she has commented that if I can afford x y and z I should be spending some on her kids.

The house me and DH have together will go 50/50 between DSS and our joint DD and any further children me and DH have we will make sure it is split equally. I however have rental properties passed down to me from my DF and that will be put in to just my name and when the time comes they will go to DD and any further children me and DH have together and them only. Might sound harsh but it's what my DF wants and everyone is fine with it.

When we did wills everything is divided so that we each split our half of everything between our own children. So my older boys and the SC would get 1/6 each, and our shared DS would get 1/3 (1/6 from each of his parents).

My older boys will inherit via their father (and not have to share that with a sibling). The SC have a mother and it’s not up to us to compensate them for her choices in life. Our shared DS should be able to inherit from both his parents too.

Everything goes in trust til they’re 25 though. And the appointed trustees are not sympathetic to the SC’s extremely grabby mother (or my ex tbh, but he wouldn’t try to touch their inheritances; the SC’s mum would see it as yet another means of avoiding ever having to work).