Retirees Should Adjust Planning With Four Big Changes in Mind

November 20, 2025

Retirement planning is never static. Tax laws evolve, healthcare costs shift and investment conditions change sometimes dramatically. For retirees, these changes can affect everything from monthly income to estate strategies. Understanding recent adjustments in tax policy and retirement rules can help ensure that your plan remains stable and sustainable. Retirees should adjust planning with four big changes in mind.

Changing Tax Rules for Retirees

Tax planning remains one of the most potent tools for preserving retirement income. Recent federal adjustments have affected both Social Security taxation and retirement account withdrawals. For instance, higher-income retirees may see a greater portion of their Social Security benefits taxed, while inflation adjustments have shifted income brackets slightly upward.

These changes make tax diversification more critical than ever. Retirees who rely solely on traditional 401(k)s or IRAs, where withdrawals are taxed as income, could face higher overall taxes in retirement. Combining pre-tax, Roth and taxable investment accounts provides flexibility to manage income levels strategically each year.

Adjusting to Required Minimum Distribution Rules

One of the most significant changes in recent years involves Required Minimum Distributions (RMDs). The starting age for RMDs has risen to 73, giving retirees more time to grow assets tax deferred. However, waiting too long to begin withdrawals can result in larger future distributions and higher tax bills later in life.

Some retirees may benefit from partial Roth conversions in their early 60s, especially during lower-income years before Social Security or RMDs begin. Spreading conversions over several years can reduce future taxes and provide more control over income in later retirement.

The Ongoing Impact of Healthcare and Long-Term Care Costs

Healthcare remains one of the most significant expenses for retirees. Medicare premiums are expected to rise, and out-of-pocket costs for prescription drugs and long-term care continue to increase. Without planning, these expenses can quickly erode savings meant for other goals.

Health Savings Accounts (HSAs), when used properly, offer a tax-efficient way to prepare for medical costs. Funds grow tax-free and can be used for qualified expenses at any time, even in retirement. Retirees should also consider long-term care insurance or hybrid life insurance policies that include care benefits to reduce financial strain later.

Inflation and Market Volatility

Even modest inflation can significantly affect retirees who live on fixed incomes. While 2024 and 2025 have seen periods of stabilization, retirees should continue planning for long-term inflation by balancing income and growth investments.

Bond-heavy portfolios, while stable, may struggle to keep pace with inflation over the long term. Adding moderate exposure to dividend-paying stocks, real estate, or inflation-protected securities (TIPS) can provide resilience. Working with a financial advisor to review investment allocations annually ensures that risk levels remain appropriate.

Integrating Legal and Financial Planning

Estate planning and retirement planning are inseparable. Changes to tax law, account rules and estate exemptions can affect how assets transfer to heirs. Retirees should review beneficiary designations, update wills or trusts and ensure that powers of attorney and healthcare directives are current.

An estate planning attorney can help retirees adjust their planning with these four big changes in mind. They can align investment and withdrawal strategies with legacy goals. This integration ensures not only tax efficiency but also future protection for beneficiaries. If you would like to learn more about planning for retirement, please visit our previous posts.

Reference: Kiplinger (Aug. 10, 2025) “Retirees Should Watch These Four Key Tax Changes in 2025”

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Spousal Lifetime Access Trusts can Protect Your Partner

November 18, 2025

For couples with significant assets, planning for the future is necessary to ensure financial security for the surviving spouse while minimizing tax exposure. Spousal Lifetime Access Trusts can protect your partner when you are gone. Often called a SLAT, it offers an effective way to achieve both goals. Combining long-term protection with ongoing access to funds helps preserve family wealth while maintaining flexibility.

Understanding Spousal Lifetime Access Trusts

A Spousal Lifetime Access Trust is an irrevocable trust created by one spouse for the benefit of the other. The grantor transfers assets, such as investments, real estate, or business interests, into the trust, thereby removing them from their taxable estate. The non-grantor spouse can then receive income or distributions from the trust during their lifetime.

This arrangement provides a balance between tax efficiency and practical access. It allows couples to reduce the size of their taxable estate while keeping resources available should unexpected expenses or financial changes arise.

How SLATs Protect Wealth

One of the main advantages of an SLAT is its ability to shield assets from future estate taxes. With current federal exemption limits set at historically high levels, couples can transfer substantial wealth now and lock in those benefits before potential tax law changes reduce the threshold.

The trust also serves as a form of asset protection. Once transferred, the assets generally cannot be reached by the grantor’s or the beneficiary’s creditors. This makes SLATs appealing to business owners and high-net-worth families seeking long-term security.

In many cases, the trust can also distribute income to the beneficiary spouse, ensuring that the family continues to benefit from the assets even though they are no longer part of the grantor’s estate.

Key Structural Considerations

While powerful, SLATs require careful design. Because they are irrevocable, the grantor cannot reclaim the assets after transferring them. Couples must ensure that they retain sufficient liquidity and income outside the trust to maintain their standard of living.

If both spouses create SLATs for each other, the trusts must differ meaningfully to avoid triggering the “reciprocal trust doctrine.” This IRS rule can invalidate tax benefits if two trusts are too similar, effectively treating each spouse as if they never transferred the assets in the first place.

Working with an experienced estate planning attorney helps ensure that each trust is structured uniquely using different funding sources, timing, or distribution terms to comply with IRS standards.

When to Consider a SLAT

A Spousal Lifetime Access Trust is particularly beneficial for couples with taxable estates who want to take advantage of the current high federal estate tax exemptions, which are set to increase from $13.99 million per person to $15 million for 2026. It’s also ideal for individuals who wish to preserve family wealth without cutting off financial flexibility for their spouse.

In addition, SLATs can complement other estate planning tools, such as irrevocable life insurance trusts or charitable trusts. By layering strategies, couples can maximize protection and tailor distributions to meet both personal and philanthropic goals.

Balancing Flexibility and Finality

Because SLATs are permanent, they require both foresight and discipline. Once assets move into the trust, they are beyond the grantor’s reach. However, that finality is what gives them their power. The trust ensures that estate taxes, legal claims, or financial mismanagement will not erode assets.

Spousal Lifetime Access Trusts can protect your partner when you are gone. Couples who thoughtfully design SLATs often find peace of mind knowing that their partner will be cared for, no matter what happens. If you would like to learn more about SLATS, please visit our previous posts.

Reference: Forbes (Sep. 30, 2025) “Spousal Lifetime Access Trusts: A Strategic Estate Planning Tool”

Portability Doesn’t Happen Automatically

November 13, 2025

Portability allows a surviving spouse to use any “leftover” estate tax exclusion from the first spouse to die. It’s a powerful estate planning technique, according to a recent article in Think Advisor, “This Estate Tax Filing Mistake Can Cost Clients Millions.” However, portability doesn’t happen automatically.

To secure portability, the executor of the first deceased spouse’s estate must file a Form 706—known as an estate tax return—to elect portability, and it must be filed in a timely manner and be properly prepared.

This is necessary even if no estate tax is otherwise due from the deceased spouse’s estate. Given the high federal estate tax exemption, most affluent couples nearing the threshold don’t need to file the form. However, it’s still worth filling it out. Here’s why.

A husband who dies with $5 million in assets passes that along to his wife, who may have $10 million of her own. If she lives another 20 years and is invested in markets, her wealth upon her death could be very close to or over the maximum estate tax exemption for a single person. If she secures portability at the time of her husband’s death, she can use his remaining estate tax exemption amount and avoid significant estate tax when passing wealth onto her heirs.

Even if the first spouse to pass doesn’t come close to the federal estate tax threshold, it still makes sense to take the right steps to secure portability. A recent Tax Court case illustrates how this can go wrong if not done correctly. A successful midwestern business owner died, and the form wasn’t filled out correctly. The filing mistake cost heirs an additional $1.5 million in estate taxes from the surviving spouse’s estate.

The deadline to elect portability of a deceased spouse’s unused federal estate tax exemption is nine months after the date of death. While your estate planning attorney can request a six-month extension, it’s best to do this in a timely manner. If the estate isn’t otherwise required to file an estate tax return, you can use the Revenue Procedure 2022-32. This was added after many estates failed to file for portability because they didn’t realize it was needed until after the federal estate tax return was due.

This process is not easy and involves several important steps, especially if any of the first-to-die spouse’s assets flow to anyone other than the surviving spouse or a charity. In these situations, assets flowing out of the first estate must be assigned a fair market value using a valuation professional.

The IRS provides a valuation method for estates filing solely to capture portability. An executor may use a good-faith estimate of the value. However, securing a professional valuation may be recommended by your estate planning attorney.

The Tax Court case referred to above illustrates how this process can go wrong. The assets passed down by the first spouse to die went to other family members, not her spouse or a charity. A proper valuation was not done. The executor also applied for an automatic extension to file Form 706 but failed to mail the return until five months after the extended deadline. There are some instances when the IRS provides a “safe harbor” for late filing. However, this only applies when the value of the first deceased spouse’s estate is less than the applicable exclusion amount. The return was not complete, nor was it properly prepared.

Portability is a beneficial option and shouldn’t be missed, even when it seems unlikely to be needed. Just remember – portability doesn’t happen automatically. An experienced estate planning attorney should be consulted to protect the estate upon the death of the first spouse to secure portability. If you would like to learn more about portability and estate planning, please visit our previous posts.

Reference: Think Advisor (October 15, 2025) “This Estate Tax Filing Mistake Can Cost Clients Millions”

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A Cross-Border Strategy is Needed for Estate Planning with Assets Overseas

November 11, 2025

Ultra-high-net-worth families often live, invest and give across borders. A plan that works in one country can misfire in another. Different rules on domicile, tax residency, marital property and forced heirship can alter who inherits and how much tax is due. Institutions may also block access to accounts until local requirements are met. A cross-border strategy is needed for estate planning with assets overseas. It brings these moving parts into one coherent framework, so heirs receive what you intend with fewer delays and fewer surprises.

Where Plans Break Across Borders

Countries define domicile and tax residency in different ways. One country may view you as a resident based on days present, another based on ties such as a home or family. Several civil law jurisdictions enforce forced heirship, which reserves a portion of an estate for children or a spouse regardless of what your will says.

Community property and separate property systems divide marital wealth differently. Without alignment, the same asset can face competing claims or double taxation. Bank secrecy and data rules can also slow access, especially when fiduciaries lack translated and apostilled documents.

Building A Multi-Jurisdiction Framework

Begin by documenting where you are treated as tax resident and where you are domiciled. Keep residency certificates, visa records and professional analyses that explain treaty positions.

Next, identify succession rules that could override your choices. Some jurisdictions allow you to elect the law of your nationality or habitual residence to govern your estate. Make that election clearly in your will or trust if it is available and ensure that each country where you hold assets will honor it.

Align legal structures with asset locations. Company shares, private funds and real estate often benefit from situs-appropriate holding entities or trusts that are recognized locally.

Confirm whether the jurisdictions you care about recognize common law trusts, civil law foundations, or both. Where recognition is limited, consider alternatives such as shareholder agreements, life insurance wrappers, or local testamentary tools.

Coordinating Fiduciaries and Access

Execution details matter. Appoint executors and trustees who can act in each country or name local co-fiduciaries where required. Prepare notarized and apostilled copies of core documents and translations into the languages your institutions require.

Maintain a secure inventory of accounts, safekeeping locations and key relationships, along with device passcodes and instructions for two factor authentication. These access steps are as necessary as the legal documents, since many institutions will not release information without them.

Philanthropy, Art, And Liquidity

Cross-border philanthropy can trigger registration, reporting, or withholding. Decide whether to use a single foundation, parallel entities, or donor-advised funds in more than one country, for art, yachts, aircraft and collectibles, track situs, export and cultural property restrictions and insurance conditions.

Plan liquidity for taxes that may be due before private business interests or real estate can be sold. Consider credit facilities, life insurance, or staged distributions to avoid forced sales at a discount.

Using Multiple Wills Safely

Many families benefit from separate wills for different countries. Each will should cover only assets in its jurisdiction and should state that it is limited in scope so it does not revoke the other will. Coordinate signing formalities, witnesses and governing law choices. Keep originals and certified copies in a location where fiduciaries can easily access them.

How An Estate Planning Law Firm Can Help

An estate planning law firm with cross-border experience can map domiciles and residencies, make governing law choices where permitted and tailor trusts or entities that local courts and registries recognize. A cross-border strategy is needed for estate planning with assets overseas. If your life spans more than one country, schedule a consultation so a lawyer can align documents, structures and access protocols before a crisis forces hurried decisions. If you would like to learn more about estate planning for assets overseas, please visit our previous posts.

Reference: Forbes (September 24, 2025) “Cross-Border Estate Planning Guide, Essential Strategies For Ultra High-Net-Worth Families”

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Choosing a Guardian for Minor Children is Critical

October 14, 2025

Parents often focus on wills, trusts and financial planning. However, they overlook naming a guardian for their children. Choosing a guardian for your minor children is a critical step. Without this step, a court may decide who raises the child if both parents are unable to do so. While judges consider family ties and the child’s best interests, the decision may not reflect your preferences. Proactive planning provides peace of mind and helps prevent uncertainty during an already challenging time.

Key Considerations in Choosing a Guardian

Guardian selection should not be rushed. Families should weigh a variety of factors before naming someone.

Emotional and Practical Suitability:

The guardian should have the ability and willingness to provide both emotional stability and day-to-day care. Consider their relationship with the child, their parenting style and their values. A guardian’s age and health also matter. While grandparents may love deeply, they may not be physically equipped to raise young children long-term.

Financial Stability:

Raising children is expensive. A guardian does not need to be wealthy. However, they should have the financial means to provide a stable home. Estate planning tools, such as life insurance and trusts, can supplement the guardian’s resources and ensure that children’s needs are met.

Location and Lifestyle:

The guardian’s location may affect schooling, friendships and the child’s sense of continuity. Consider whether relocation would be necessary and assess the potential disruption it might cause. Lifestyle factors, such as work commitments, existing family dynamics, or religious beliefs, should also be considered to ensure alignment with your wishes.

Naming and Documenting a Guardian

Once you have decided on a guardian, it is crucial to make the designation legally binding.

Using a Will or Legal Document:

The primary place to name a guardian is in your will. Without this, the court decides. A clear, legally valid designation ensures your choice is respected. In some cases, you may include alternates if the first choice is unable or unwilling to serve.

Open Communication with Potential Guardians:

Before finalizing the decision, have an honest conversation with the chosen guardian. Confirm that they are comfortable with the responsibility and that they understand your expectations. Discuss practical matters, such as education, healthcare and long-term goals for your children.

The Role of Estate Planning in Supporting Guardians

A guardian’s role is primarily personal and emotional. However, financial structures can ease the transition.

Trusts to Manage Assets:

Appointing a trustee to manage the child’s inheritance allows the guardian to focus on caregiving. The trustee and guardian may be the same person or different individuals, depending on your comfort level. Separating financial and caregiving roles can sometimes reduce conflicts and ensure accountability.

Regular Review and Updates:

Life circumstances change. A chosen guardian may move, experience health problems, or no longer be the best fit. Revisiting your estate plan every few years ensures that the guardian designation remains appropriate.

Why Legal Guidance Is Essential

Guardian selection is a deeply personal decision. However, it also has legal and financial implications. An estate planning attorney ensures the designation is executed correctly and that supporting documents, such as wills, trusts and powers of attorney, work together to provide a safety net for your children.

Choosing a guardian for your minor children is a critical. Consulting an estate planning law firm provides peace of mind that your children will be cared for according to your wishes. If you would like to learn more about guardianship, please visit our previous posts.

Reference: BabyCenter “How to choose a guardian for your child”

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Preparing an Estate Plan when Children Live in Another State

October 7, 2025

Zoom calls, text groups and old-school phone calls make staying in touch with adult children and grandchildren far easier than in the past. However, there are some things where being in a different state requires extra care. Preparing an estate plan when children live in another state, is one example. When the time comes to set an estate plan in place, it’s critical to know how estate plans are managed in other states, according to a recent article, “Estate plans can get complicated with out-of-state children” from the Cleveland Jewish News.

Every state has its own rules, and, in some cases, every local court has its own rules. In one state, the probate court may be fine with having an out-of-state executor. However, some states may not allow an out-of-state executor without having an additional in-state co-executor. Alternatively, they may require the out-of-state executor to post a bond, which can incur additional costs and be invasive, as it involves a credit check.

The easiest way to avoid this is by having estate planning in place long before it’s needed. This may not be top of mind when people are in their 40s or 50s. However, the general rule is that if you have assets, you need an estate plan.

Even college students or recent grads who only have savings and checking accounts need an estate plan. Parents of students over 18 need to be designated as their child’s health care power of attorney, so they can make medical decisions for their child. Anyone going off to college needs to have both a financial POA and a healthcare power of attorney document.

Suppose all the children live out of state. In that case, it is a good idea to establish a relationship with an estate planning attorney and other financial professionals so they can step in if the family can’t be present to pull together the many documents needed to settle an estate. While it’s not unusual for an estate planning attorney to go to a deceased person’s home and dig through their paperwork to find tax returns and financial records, it’s not ideal. It would be far better for family members to take care of these tasks in advance.

How property is left to heirs is also governed by state law and could result in different family members receiving different amounts. For example, Ohio doesn’t have an inheritance tax, but Pennsylvania does. One heir could find their inheritance decreased significantly because of an inheritance tax, while another would receive their inheritance tax-free.

You’ll want to be sure there are no ambiguities in the estate plan so the executor will have clear directions. Preparing an estate plan when children live in another state doesn’t have to be hard. A conversation with your estate planning attorney and executor in advance of your death could feel a bit macabre. However, it could prevent a host of problems in the future. If you would like to learn more about estate planning, please visit our previous posts.

Reference: Cleveland Jewish News (Sep. 10, 2025) “Estate plans can get complicated with out of state children”

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Combining Philanthropy with Estate Planning

September 30, 2025

If you have a goal of combining your philanthropy with your estate planning, there are strategies to be tax-smart in your giving. Tax smart giving takes advantage of charitable gifting rules to help charities while increasing tax efficiency. Like all estate planning, philanthropy should be intentional and strategic, requiring careful planning with an experienced estate planning attorney. A recent article from The Wall Street Journal, “Giving Smarter: Tax-Savvy Philanthropy for Wealthy Families,” explains how smart giving tactics can reduce taxes while creating a legacy of giving.

Tools include Donor Advised Funds (DAFs), Charitable Remainder Trusts (CRTs), Charitable Lead Trusts (CLTs) and Qualified Charitable Distributions (QCDs).

The DAF offers a simple way to make deductions up front and take a bigger deduction without giving the entire donation at once. Some benefits of a DAF include receiving an immediate tax deduction, avoiding long-term capital gains taxes if long-term appreciated assets are donated, simplified record keeping and relatively low fees. The best results from a DAF come from directly donating appreciated assets, such as stocks or mutual fund shares.

Charitable Remainder Trusts are a means of creating a steady stream of income for a charity. The CRT assumes you’ll give money to a set of beneficiaries over a specific period. At the conclusion of the trust, the charity receives the remainder. The tax deduction is immediate and appreciated assets sold within the trust are free of capital gains taxes. CRTs are irrevocable, which needs to be kept in mind while creating the tax-savvy estate plan.

A Charitable Lead Trust takes a different approach. The trust provides income to charities for a specific period. At the end, any assets in the trust go to the beneficiaries named in the trust. A CLT is also irrevocable. This can work to reduce the taxable value of the estate and allow assets to be passed on to beneficiaries. There are state laws to consider, so you’ll need the help of an experienced estate planning attorney.

These trusts require careful planning and consideration considering your overall long-term goals as well as your philanthropic goals.

For very high-net-worth people, a family foundation offers a high degree of control and provides tax benefits. However, a family foundation must have a charitable purpose, and a certain percentage of net assets must be distributed to charity annually. A 990-tax form must be filed, an excise tax will be due,and meticulous records must be kept. While family members can receive compensation for working in the family foundation, any payments must be reasonable, and the foundation must be in line with 401 (c)(3) regulations. A DAF may be an easier way to gain similar advantages with far less paperwork.

Talk with your estate planning attorney to ensure that your philanthropy combines with your overall estate planning goals. A philanthropic legacy doesn’t have to involve millions. However, at any level of wealth, a plan ensures that your wishes are followed and you reap tax benefits. Accomplishing both takes planning. If you would like to learn more about charitable giving, please visit our previous posts.

Reference: The Wall Street Journal, Aug. 14, 2025, “Giving Smarter: Tax-Savvy Philanthropy for Wealthy Families”

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Protect Your Child’s Inheritance in a Second Marriage

September 24, 2025

Having a revocable trust may or may not protect assets for biological children on the death of their parent if the parent has remarried. This is why a recent article from the New Hampshire Union Leader, “Know the Law: Ensuring Assets go where you want in your revocable trust,” advises readers to speak with an experienced estate planning attorney about how to protect your child’s inheritance in a second marriage.

Surviving spouses in many states are permitted to claim an elective share of their deceased spouse’s estate to avoid being disinherited or being inadequately provided for when the spouse dies. If the decedent has children, the surviving spouse is entitled in some states to one-third of the probate estate. In some states, revocable trust assets are not automatically included as part of the decedent’s probate estate.

If there are assets in a revocable trust for children, they may be protected if the surviving spouse waives testate distribution and decides they’d rather claim the statutory elective share. Under certain circumstances, the surviving spouse could ask the court to set aside transfers of assets made into the revocable trust. If the court determines the transfers were invalid, then the revocable trust will become part of the probate estate and part of the elective share calculation.

In some states, the scope of the statutory elective share automatically includes assets in revocable trusts. Suppose someone moves from a state where this is not the case to a home in a state where revocable trust assets are considered part of the probate estate for elective share purposes and the estate is probated in the new state. In that case, that portion of the revocable trust assets will be available to the surviving spouse.

If the revocable trust isn’t fully funded and the assets intended to go into the trust remain in the spouse’s name, such as bank accounts and real estate, those assets will also be part of the probate estate.

Depending upon the plan rules and state laws, surviving spouses may also automatically be the beneficiary of any qualified retirement accounts, like 401(k)s or 403(b)s. Unless the spouse waives their right to the survivor benefits, they are, in most cases, the only person who will receive the pension assets.

Concerns about not disinheriting children from a prior marriage are often addressed through estate planning. However, a pre-nuptial agreement could also define what each spouse would be entitled to in the event of a divorce or when each spouse dies.

A consultation with an estate planning attorney in your state should take place to protect your child’s inheritance in a second marriage. It’s best to address the issues before walking down the aisle to prevent any misunderstandings in the future and start a new marriage with a clean slate. If you would like to learn more about remarriage protection, please visit our previous posts.

Reference: New Hampshire Union Leader (Aug. 18, 2025) “Know the Law: Ensuring Assets go where you want in your revocable trust”

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It is Wise to Add Your Trust to Your Homeowner’s Policy

September 8, 2025

If you’ve placed your home in a trust as part of your estate planning, which many people wisely do, it is wise to complete another task: add your trust to the homeowner’s policy. This detail can make or break your financial life, says a recent article, “Homeowners insurance warning: Why your trust must be listed on your policy,” from WFAA.

Regardless of who has paid the premiums and how long the insurance policy has been in place, if you don’t list the trust as a policyholder, the insurance company can deny coverage. Many homeowners who have created trusts to pass their property along after their death have encountered problems having their homes repaired or rebuilt after wildfires, floods and tornadoes because the trust wasn’t added to the insurance policy.

In most cases, the trust needs to be listed as an additional insured. However, it is essential to verify with both your estate planning attorney and your insurance company to ensure that your property is adequately protected. If it isn’t and you suffer a loss and file a claim, you may learn you don’t have the required “insurable interest.”

You may end up in court with no guarantee of a successful outcome. Insurance companies are notorious for pushing back on expensive claims when there’s wiggle room, and the owner of the property not being listed as an insured offers plenty of wiggle room to the insurance company.

According to the article, the owner of the property is the only entity with an insurance interest in the property. If the owner is the trust, the trust must be listed on the insurance policy.

Do your due diligence and ensure the homeowner’s insurance policy includes all the necessary individuals and entities. It’s essential to do this now, before a claim is filed and rejected.

If you have placed your home in a trust and haven’t yet updated the deeds or other critical documents, this article should provide the necessary incentive.

Once an experienced estate planning attorney creates a trust, the details must be carefully attended to for the trust to function as intended. If you create a trust and fail to fund it, the trust won’t work. This includes retitling investment accounts, business entities and insurance policies.

It is wise to add your trust to the homeowner’s policy. If you don’t have an estate plan in place, now is the time to consult with an experienced estate planning attorney and start the process. Once the estate plan is in process, ask your attorney for a checklist to be sure you get all the necessary tasks done. You’ll sleep better knowing your family, your home and your future are protected. If you would like to learn more about estate planning and insurance, please visit our previous posts.

Reference: WFAA (Aug. 13, 2025) “Homeowners insurance warning: Why your trust must be listed on your policy”

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How Wealth is Distributed in Blended Families

September 2, 2025

This summer’s passing of Ozzy Osbourne was mourned by heavy metal fans. Whether you liked his music or not, Osbourne left an estate estimated to be worth $230 million plus future royalties, reports a recent article from Think Advisor, “What Wealthy Families Can Learn From a Rock Star’s Estate.” It caught the attention of estate planning attorneys for lessons about how wealth is distributed in blended families. Whether you liked his music or not, Osbourne left an estate estimated to be worth $230 million plus future royalties, reports a recent article from Think Advisor, “What Wealthy Families Can Learn From a Rock Star’s Estate.”

There’s no estate battle for now. However, only time will tell if the Osbourne family faces issues like those of many blended families. There’s no simple playbook for these situations, and the best outcomes require the counsel of an experienced estate planning attorney and savvy planning.

Creating trust structures to balance a surviving spouse’s financial well-being with inheritances for children from prior marriages takes knowledge and experience. A plan needs to be proactively created and regularly revisited to affirm the choices made. The challenge is anticipating potential disputes.

An ill-conceived plan would be to place all the assets in a single trust to benefit the surviving spouse during their lifetime and then have the assets flow to the biological children after their death. This sounds like a good solution. However, the arrangement puts the surviving spouse’s interests at odds with those of the children. They’re waiting for the surviving spouse to die for their inheritance and have no control over how much money is spent. They might end up with nothing, despite the best intentions of the deceased spouse.

Another solution with potential for disaster is creating an estate for the benefit of the surviving spouse and putting one or more of the biological children in charge of the estate in an attempt to balance the structure. The surviving spouse is now dependent upon the biological children to ask for money, which can create more problems than it solves.

A controlling trustee is often considered a potential solution for blended family estate plans. If the surviving spouse is intent on blowing through the money, the children can go to court and file a lawsuit to ensure that their rights and interests are protected. However, litigation is expensive and divisive.

A better idea might be to leave the house and a portion of the liquid estate to the surviving spouse, while leaving the rest of the estate to the children. The goal is to prevent tension between family members over access and control of assets.

An estate plan for a blended family requires effective communication, thorough planning and a delicate balance to protect the interests of all parties. It’s not easy. An experienced estate planning attorney can help you understand how wealth is distributed in blended families to ensure that it remains effective over time. The result of a blended family remaining a family after one of the spouses has passed can be more of a legacy than wealth. If you would like to learn more about planning for blended families, please visit our previous posts.

Reference: Think Advisor (Aug. 11, 2025) “What Wealthy Families Can Learn From a Rock Star’s Estate”

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Category: Financial Planning