Estate planning - strategies that are fit for a King

King Charles III and Queen Camilla cast aside a number of traditions and customs at their coronation in favour of putting their blended family at the forefront of the millennium-old ceremony.

The couple’s grown-up children and young grandchildren not only attended but youngsters from each side of the family had important roles in the service.

In an era of diversity and inclusivity the traditional concept of a nuclear family is now regularly challenged resulting in more nuanced estate planning. 

Blended families, comprising individuals who remarry or cohabit with children from previous relationships, often face unique emotional and practical challenges when it comes to inheritance. Other components may include cultural, racial, ethnic, capacity and geographical considerations. Ensuring the smooth transition of assets and preventing potential disputes requires careful consideration and strategic planning.

Here, we explore proactive measures to prevent and combat challenges:

Communication. Clearly conveying wishes regarding inheritance with all relevant parties, including a spouse, children and stepchildren is essential. Transparency can help mitigate misunderstandings.

Professional help. Lawyers who specialise in estate planning for blended families, can provide tailored advice to ensure plans are legally sound. Beneficiaries may be transgender, non-binary, conceived through medically assisted means or surrogacy so there should be thought to definitions and wording.

Updates. Life events such as marriage, divorce, birth or death can significantly impact an estate plan. Regular updates should reflect changes in family dynamics or financial situations, failure to do so may leave loopholes leading to disputes in the future.

Trusts. Trusts can be an effective tool for safeguarding assets and providing for both current and future family members. Establishing a trust allows you to stipulate how and when beneficiaries receive their inheritance, providing greater control and protection against potential challenges and offer more flexibility than a mutual Will.

Pre-nuptial and post-nuptial agreements. For couples entering into a new marriage or civil partnership, pre-nuptial or post-nuptial agreements can clarify financial arrangements and inheritance rights. These agreements can help delineate assets acquired before and during the marriage, reducing the likelihood of inheritance disputes.

Documentation. Be explicit about intentions regarding specific assets and beneficiaries. Letters of Wishes can articulate the reasoning behind unequal distributions or provisions for stepchildren to minimize ambiguity and potential challenges. Keeping careful records of discussions and instructions is valuable in the event of challenges.

Family harmony. Communication, respect and empathy help nurture positive relationships within a blended family to help mitigate the risk of challenges.

Education. Ensure family members understand the reasoning behind an estate plan, educating everyone can help manage expectations and reduce the likelihood of disagreements.

Blended families give rise to many complex issues but planning can reduce the risk of a testator’s wishes not being followed. All eventualities, even if not currently pertinent, require foresight and careful planning.

How can Abacus help?

Abacus has a reputation for offering a market leading service for the establishment and management of trusts. A trust is not a separate legal entity but a relationship and the team has carefully crafted its personalised offer by collaborating with individuals, their families, long-term advisers and liaising with several generations of the same family at any one time. 

We are experienced at working with clients, professional advisers, investment managers, private companies and family offices who all appreciate our pragmatic and technical performance.

We have the empathy and experience to assist settlors looking to protect the interests of minors or those with specific vulnerabilities

We are used to working with blended, extended and geographically dispersed families with families who utilise frameworks including family charters, shareholder agreements, investor agreements as well as pre and post-nuptial agreements.

No action should be taken on the basis of this note, nor should it be construed as amounting to tax, legal or VAT advice. Suitable, specific and professional advice should always be obtained in respect on any particular issue.

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