Inheritance Arguments in Blended Families

Blended families are common features of modern life. Moreover, 2022 government statistics show that multi-family households are the fastest-growing category. And legal, financial and practical problems often cause tension. So, it’s essential to consider how couples can provide for each other and their children without causing unnecessary hardship and corrosive family arguments.

 Common Triggers

In our experience, the most common triggers include: 

1. Not Making a Will

When a spouse dies without leaving a Will, the Intestacy rules apply. Sadly, this often causes tension when close family members don’t inherit what they believe they were promised.

For example, if the estate is worth £270,000 or less, the deceased’s surviving spouse inherits the entire estate. If the estate is over £270,000, the surviving spouse inherits half of everything over the £270,000 threshold. The remainder is divided between surviving children, which can leave the children with nothing.

If the surviving spouse also dies intestate, their estate passes to their surviving children, leaving their stepchildren with nothing. 

2. Leaving Everything to Surviving Spouse

Another common trigger is leaving everything to the surviving spouse, having mutually agreed that the children will inherit equally when the surviving spouse dies. Unfortunately, in practice, this doesn’t always happen.

3. Drawing up Mirror Wills

Essentially, each spouse leaves everything to the other, leaving everything to their children when the surviving spouse dies.

However, with a Mirror Will, each person can revoke their Will at any time before or after the death of the other and can change the terms of their Will without letting the other know. In the context of blended families, the effect can be dramatic.

Mutual Wills: should not be confused with Mirror Wills. Mutual Wills are binding but inflexible. For example, if the surviving spouse falls out with a beneficiary, that beneficiary still benefits from the Will. So, Mutual Wills aren’t necessarily appropriate either.

Avoiding Arguments

There are a few good options to look at, including: 

1. Life Interest Trusts

If you have assets you’d like to protect, or you want to make sure you are even-handed in distributing your wealth, consider setting up a trust. A Life Interest Trust allows one beneficiary to benefit from an asset (such as the family home) or income during their lifetime. When that individual’s beneficial interest ends (e.g., on death or remarriage), that trust support or income passes to another beneficiary.

Whilst a Life Interest Trust provides certainty of destination, you will have lost control over the property’s value. So, if you want to release money from the house, change who benefits if one of the beneficiaries dies, divorces, becomes bankrupt or falls out with you – you may wish you have never entered into the transaction.

2. Gifts to Children

Leaving specific or residuary gifts to children is also a way to ensure your children inherit no matter what. 

3. Joint Property Ownership

Owning property as joint tenants means that when one spouse dies, the property is automatically transferred into the sole name of the surviving spouse.

So, in a blended family scenario, couples should consider holding the family home (and other joint property) on trust as tenants in common, specifying their share, for example, 50/50. This means that when one spouse dies, their share automatically becomes part of their estate and can be left to beneficiaries in their Will.

4. Wills & Marriage or Remarriage

Any Will written before getting married or remarried is voided unless the Will is made ‘in contemplation’ of that marriage. A new Will must be signed when you remarry. If not, the rules of intestacy apply.

Our Advice

It’s difficult to balance competing interests without appearing distrustful, so talk to your family. Make sure the close family knows what you’re planning to do with your Will, so they don’t feel left out. And choose your Executor carefully; a professional can be an enormous help further down the line.

For further information or advice from our specialist team, please contact us. We’re here to help.

Please note that all views, comments or opinions expressed are for information only and do not constitute and should not be interpreted as being comprehensive or as giving legal advice. No one should seek to rely or act upon, or refrain from acting upon, the views, comments or opinions expressed herein without first obtaining specialist, professional or independent advice. While every effort has been made to ensure accuracy, Curtis Parkinson cannot be held liable for any errors, omissions or inaccuracies.

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