Northwest Arkansas Democrat-Gazette
“My wife and I are both in our second marriages. Each of us brought several children into this marriage. She thinks the children of one spouse could be completely left out of our estate depending on the order of death. Do we really have anything to worry
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Answer: Your wife is right. Without proper planning, either your children or her children could be unintentionally disinherited. The family left out would depend entirely on which spouse died first.
Most married couples own most of their assets jointly. Both names appear on the deed to the house and the titles to the cars, and their checking, savings, and investments are held in joint accounts. When the first spouse dies, this would not appear to be a problem. In fact, this type of arrangement helps to ensure that no lawyers and no probate court are needed when the first spouse dies.
However, if you have things set up this way and you’re the first to go, your children could have a major problem. Under this plan, when you go, everything will be owned individually by your wife. When she dies, Arkansas law says her assets pass to her biological children, not her stepchildren.
Having a basic will may not get around this problem. Even if you leave your children some assets in your will, that will not override the law regarding joint ownership. Anyway, most married couples leave everything to each other in their wills so we’re right back where we started.
If you want to protect your spouse but also ensure your children are not left out, the best solution I’ve used is a revocable living trust. To learn more about planning with trusts (in both simple and complicated situations) call today to set up a nocharge strategy session to find out how we can help with issues like these. To learn more, check out our website, ElrodFirm.com.