04 Oct Remarrying? How to Protect Your Children’s Inheritance

Hi Everyone!

This past weekend I got together in Dallas with my old college friends for the Texas A&M/Arkansas game.  It was great catching up with all of them after many years.  Lots of laughs and life changes with all of us.  A couple of them had been through divorces and we talked about how they and their kids were managing.  It got me thinking of a situation I see often with divorces and remarriages and the added complexity of these situations (often called, “blended” families).

Estate Planning’s Role in Blended Families

When you’re divorced, remarried, and have children from a previous marriage, you’ve got more to worry about than the average family. You’ve worked hard to build your wealth, and you want to ensure your children from your first marriage get their fair share of that inheritance when you’re gone. But if you’re married again, what happens if you pass away and your second spouse remarries? Could your children’s inheritance be at risk?

If this is a concern, you’re not alone. Many remarried individuals with children from a prior marriage are rightfully concerned about the security of their children’s financial future.  Ryan’s story below illustrates what can go wrong when proper estate planning isn’t in place.

A Cautionary Tale: Ryan’s Legacy Lost

Ryan was a successful business owner who had worked tirelessly to provide for his two children from his first marriage. After divorcing their mother, Ryan eventually remarried Lisa, a kind woman who treated his children well. Ryan loved his new wife but was always concerned about ensuring that his kids from the first marriage would receive their fair share of his wealth after he was gone.

Ryan thought he had covered his bases with a basic will that left his assets to Lisa, assuming she would make sure to pass down the remainder to his children when she no longer needed it. He trusted Lisa and believed she would act in the children’s best interest. But after Ryan passed away suddenly from a heart attack, things took a turn for the worse.

Lisa was devastated by Ryan’s death and, within a few years, remarried a man named Marcus. On the surface, Marcus seemed like a great guy. He was charming, attentive, and seemed to care deeply for Lisa. However, beneath the surface, Marcus had a history of financial mismanagement and manipulation. Slowly, he convinced Lisa to liquidate parts of Ryan’s estate to fund their new lifestyle—expensive vacations, a new home, and a string of bad business ventures.

Lisa, vulnerable and eager to please her new husband, didn’t realize what was happening until it was too late. Marcus drained her of the assets Ryan had intended to eventually pass on to his children. As Lisa’s health declined, Marcus left her, taking a significant portion of what was left of the estate.

By the time Lisa passed away, there was almost nothing left for Ryan’s children. The inheritance Ryan had worked so hard to build for his kids had been squandered. His children, now adults, were left with little more than frustration and regret that their father’s legacy had been wiped out by someone who wasn’t even part of their family.

The Lesson: What Ryan Could Have Done Differently

Ryan’s mistake was trusting that things would work out without a carefully designed plan in place. While he assumed his spouse would always protect his children’s interests, he hadn’t anticipated the possibility that a future marriage or an unscrupulous partner could undermine his wishes.

This tragic outcome is not uncommon, but it’s also entirely preventable with proper estate planning.

The Solution: Trust Planning with Divorce Protection (“Creditor and Predator” Protection)

Had Ryan worked with an experienced estate planning attorney, he could have put a much more effective plan in place to protect his children’s inheritance.   One of the tools available for this scenario involves structuring a trust to balance providing for Lisa’s financial security while ensuring that Ryan’s children’s inheritance was safeguarded.

The way it works is that the trust would include special provisions and language to protect both the surviving spouse and the children from a prior marriage.  It’s sometimes called “creditor and predator” protection.  In our example above, the trust would provide income for Lisa for the rest of her life, ensuring she’s comfortable and supported after Ryan’s death. The trust would hold Ryan’s assets, providing Lisa with income, but she wouldn’t have access to the principal (the underlying assets) without restrictions.

Critically, Ryan could have named his children (or other trusted individuals) as the beneficiaries of the trust’s principal. After Lisa’s death, whatever remained in the trust would go directly to Ryan’s children, ensuring that no future spouse or bad financial decisions could jeopardize their inheritance.

By using this “creditor and predator” protection in a trust, Ryan’s children would be protected even if Lisa remarried. Marcus (or anyone else) wouldn’t have access to the assets in the trust. Lisa would receive income to support her, but Marcus wouldn’t be able to pressure her into spending down the principal meant for Ryan’s children.

Why You Need an Estate Planning Strategy for Blended Families

The reality is that when you remarry and have children from a prior marriage, estate planning becomes much more complex. Relying on a simple will or even assuming your surviving spouse will make the “right” decisions isn’t enough to protect your children’s inheritance. When emotions, remarriages, and unexpected life events come into play, things can go wrong fast—just like in Ryan’s story.

Take Action Now

If you’re remarried and have children from a previous marriage, now is the time to take action. Protect what you’ve worked hard to build and ensure your legacy is preserved the way you intend.  Don’t leave your children’s future to chance.

Talk to us now: Schedule here