His, Hers & Theirs

     Here are two trivia questions for you movie and television buffs. First, what big name Hollywood stars played on-screen spouses in the 1968 film Yours, Mine & Ours? The basic storyline of the movie paired a widow and her eight children with a widower and his ten children. Second, a year later Sherwood Schwartz (creator of Gilligan's Island) took the same basic storyline and rolled out a hit television series that ran for 117 episodes. Can you name that show? [The answers are at the end of this article.]
     One reason commonly given for the popularity of these two classics is that they gave traditional nuclear families a lighthearted glimpse into the lives of blended families. Times have changed. In the new millennium, blended families now outnumber traditional nuclear families. And the number is likely to grow, based on current statistics and trends.
     Unlike the movies or 30-minute sitcoms, real life is not always so lighthearted for blended families, whether due to widowhood or divorce. Many face unique social, psychological and economic challenges.

The Challenges

     More than 60 percent of second marriages end in divorce. Certainly some blame for that sad statistic lies in the difficulty of successfully blending formerly separate families. Fortunately, there are numerous organizations and support groups dedicated to helping blended families with these challenges. Unfortunately, little attention has been paid to the critical Life & Estate Planning challenges confronting blended families. These challenges include disinheriting your ex-spouse, protecting your own children, providing for your new spouse and minimizing your estate taxes.

Your Ex-Spouse

     Without proper legal planning, your ex-spouse (as surviving parent/guardian) would likely be appointed by the probate court to manage the inheritance you leave to your children. To make matters worse, what if your children later predecease your ex-spouse, and are single and childless at that time? Who would inherit your assets then? That is right ... your ex-spouse, as the next-of-kin of your children.

Your New Spouse

     Chances are you made a few solemn promises to your new spouse on your wedding day. Among them were promises to be there through thick and thin, personally and financially. Accordingly, most spouses in blended families tend to blend their wealth, too.
     Warning: If you predecease your new spouse, then you may forever disinherit your own children from your share of such blended wealth! Thereafter, upon the death of your new spouse, your assets may be inherited by your stepchildren, or even by your new spouse's next spouse and their children.

Your Own Children

     Regardless of whether children are reared in a traditional nuclear family or in a blended family, great care should be given to protect any inheritance both for them and from them. Wealth representing a lifetime of your hard work and thrift can be squandered in very short order, or can quickly vanish through divorces, lawsuits and bankruptcies.

Your Estate Taxes

     Aside from disinheriting your own children, blending your wealth with your new spouse may unnecessarily enrich the IRS. How? The Internal Revenue Code provides an exemption to each taxpayer for purposes of sheltering a certain estate dollar value from federal estate taxes (with marginal rates reaching nearly 50 percent). However, this is a use it or lose it exemption and you lose it when title to your blended assets vests in your new spouse upon your death. In addition to disinheriting your own children, this mistake alone can trigger hundreds of thousands of dollars in unnecessary estate taxes.

Answers:

     First answer: Henry Fonda and Lucille Ball.
     Second answer: The Brady Bunch, of course!