13 Sep 2016

Don’t Disinherit your Own Kids or Grandkids!

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Here we go again.  Another horror story where Dad had kids from a prior marriage but left all to the step mother, thus she (and ultimately her kids) inherited everything, leaving Husband’s kids with nothing.

Here is what happened.   A couple years ago I gave seminar on estate planning and living trusts.   Living Trusts are my preference over wills, but both will permit a parents natural children to inherit their estate and allow protection for the surviving spouse.   Anyway a couple attended and were provided with a free initial consultation.  Both seemed in good health and like most kept postponing getting started on estate planning.   Husband later called, said he wanted to get a second interview going.  Although numerous messages were left by my office to do so, calls were not returned.   When I personally called again earlier this year, Wife informed me Husband had died.   Apparently he had gotten ill and died rather quickly.

She told me she was ‘so glad’ she did not do any ‘estate planning’ as I had recommended.  When I asked why, apparently all assets were titled in joint tenancy with rights of survivorship.   That means that when Husband passed away, ALL MARITAL AND SEPARATE PROPERTY ASSETS WENT TO WIFE AND THEN ON TO HER KIDS AFTER HER DEATH, BUT NONE TO HUSBAND’S CHILDREN.  Of course, Wife was very happy they didn’t do any ‘estate planning’ because she got everything and her husband’s kids were disinherited!   Not only that but Husband also disinherited his own grandchildren because Wife had no legal obligation to provide for anyone  beyond Husband’s death other than her herself and her own children!

This could have been averted with numerous planning techniques, which estate planning techniques are designed to protect both the surviving spouse, Husband’s kids and the surviving spouses’ kids from accidental disinheritance.   For one, Husband could have made separate provisions in his will or trust for his kids directly, so they would have gotten something on his passing.   Or, he could have left his share of the estate to his wife but in a Marital Trust.  In a Marital Trust the surviving wife is the direct beneficiary and thus she would have been provided for.   If any principal remains after Wife’s death, the remainder of husband’s share of the estate would go to Husband’s kids, rather than all to Wife’s kids once she died.

My commentary and solutions discussed in this article and constitute legal information, not legal advice.   Possible solutions discussed may or may not apply to your situation, may vary from state to state, and   not be available in the state where you reside.   If you are a Colorado resident, please feel free to call me for a free consultation at 303-457-9500.  Alternatively, be sure to discuss these issues with a competent estate planning attorney before taking any action.

Please feel free to contact me to set up a free consultation at 303-457-9500.

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