Blended families are increasingly common in Australia. They generally include half-siblings, stepchildren, and parents who may have remarried. An important consideration in estate planning for blended families is how to distribute assets fairly while protecting the interests of all family members, including stepchildren.

Making provisions for a blended family requires a well-drafted Will. Without proper planning, unintended consequences may arise, such as creating conflict amongst surviving family members or excluding step-children.

What Is a blended family?

A blended family consists of a couple where one or both partners have children from previous relationships. Step-children in such families may have legal relationships with their biological parents but not necessarily with their step-parents. Step-children are not always treated equally under the law without explicit provisions in the Will.

Why is estate planning crucial for a blended family?

Due to the legal considerations and the number of relationships involved, estate planning for blended families can be more complex than for traditional families. Some issues are:

1. Ensuring that step-children and biological children are treated fairly and in accordance with your wishes;
2. Protecting the interests of a surviving spouse whilst still leaving something for your biological children;
3. Balancing the needs of your current spouse with the needs of your children from previous relationships; and
4. Avoiding potential disputes over the division of assets.

Stepchildren and inheritance

In a blended family, step-children may not have the same automatic inheritance rights as adopted or biological children. Without a well-thought-out an estate plan and Will, the distribution of your estate may not reflect your true intentions: step-children may be inadvertently deprived of their inheritance and family rifts could arise.

Key considerations when drafting a Will

1. Explicitly name all beneficiaries: Ensure that all beneficiaries, including biological children and step-children, are clearly named in your Will and be specific about what each person will inherit.
2. Clearly communicate your wishes: Ensure that everyone understands your wishes and how the estate will be divided. Open and honest communication with your spouse, children, and step-children about your estate planning can help to avoid disputes later.
3. Consider creating a Life Interest or a Right to Reside clause in your Will: If you want your spouse to continue living in the family home, but want it to eventually pass to your children, this allows your spouse to live in the home for their lifetime, after which it is passed to your children.
4. Review binding nominations for superannuation. Superannuation is not automatically included in your Will: you must make a binding nomination with your super fund if you want your superannuation to be distributed as you wish.
5. Use Testamentary Trusts: Testamentary trusts can be a powerful tool for blended families, allowing you to leave your spouse assets while ensuring that the remaining estate eventually passes to your step-children and children according to your instructions.

Avoiding Disputes in blended families

Disputes over inheritance can be common in blended families, particularly when stepchildren feel they have been unfairly treated or there are differing expectations. To reduce the risk of conflict, consider doing the following:

1. Create a Will Early: The sooner you draft a Will that reflects your current family structure, the better. This prevents legal complications and ensures your wishes are honoured.
2. Review and update your Will regularly. Review and update your Will after major life events, such as the birth of a child, remarriage, or a change in assets.
3. Seek legal advice: A lawyer can advise you on structuring your Will to prevent disputes and ensure fairness.

Protecting your family’s future

Estate planning for blended families requires a careful balance between protecting your spouse and providing for your children and step-children. Creating a comprehensive Will and considering trusts and other legal tools ensures that your assets are distributed according to your wishes, avoiding potential disputes and securing your family’s future.

Here to Help

Contact us if you’re in a blended family and need help drafting your Will.