Murray Beith Murray LLP is a leading Scottish private client law firm.
For 175 years we have specialised in meeting the legal, financial and administrative needs of individuals and families, family trusts, charities and private companies.
Murray Beith Murray LLP is a leading Scottish private client law firm.
For 175 years we have specialised in meeting the legal, financial and administrative needs of individuals and families, family trusts, charities and private companies.
Estate planning for the blended family can be challenging. Deciding what to do with your estate when you and your partner share children can be relatively straight forward most of the time. However, when you live in a blended family, getting the balance right might be more problematic.
One of the key elements of blended families is that there are children from earlier relationships. That means there is usually a mix of children and stepchildren who are in line to inherit from their parent(s).
It is not unusual for parents to leave their entire estate to each other on first death, and to their children on the second death. However, there can be tension in blended families where one of the partners dies and the survivor then changes their Will and leaves nothing to the first deceased’s children. Alternatively, the surviving spouse or partner may not have a Will and this would result in the children of the first deceased having no claim on the estate under current Scots Law.
Children, of course, have “Legal Rights”, which means they are entitled to share in the estate of a deceased parent. However, stepchildren have no right to share in the estate of a stepparent and this is when difficulties might arise.
However, there are ways in which an estate can be shared to preserve the interests of children in blended families, which are balanced and cannot be overturned by a change in the survivor’s Will.
One of the ways in which the interests of a spouse or partner and children in a blended family can be preserved is through a liferent Will. An example of this is where the family home is held in joint names (with no special provision in the title deeds). Rather than one spouse or partner simply transferring their interest in the ownership in the house to the surviving spouse or partner, they can include a provision in their Will which provides for a liferent in their share in the property to the surviving spouse or partner with their children inheriting their share on the death of the surviving spouse or partner.
A liferent Will serves two purposes. It secures the surviving spouse or partner’s right to continue living in the family home rent-free whilst ensuring that the deceased’s children will inherit the share in the house on the death of the survivor. That means it does not matter whether the surviving spouse or partner changes their Will because the succession to the deceased’s share in the house is already settled.
This may well be a much more balanced and equitable approach than what some consider to be a traditional inheritance route where each spouse or partner leaves their estate to the other, whom failing amongst the children.
Mutual Wills are much less used in Scotland and are not generally recommended. The reason for that is that they are irrevocable and they bind the surviving spouse or partner to their terms. That means the surviving partner is locked in and cannot make any changes to the Will following the death of their spouse or partner, irrespective of any change in circumstances.
Whilst this may serve the purpose of ensuring children from different relationships benefit from the estate of their respective parent, it reduces flexibility and may cause hardship for the surviving spouse or partner.
Yet another option is for each partner to include a specific legacy or bequest in their Will to their respective children. This means on death, the children of the deceased would inherit a specific legacy or bequest at that time rather than awaiting an inheritance which may or may not arrive on the death of the surviving spouse or partner.
The challenge here is whether there are sufficient assets in the estate that the disposal of which would not be detrimental to the surviving spouse or partner.
Murray Beith Murray LLP Partner, Andrew Paterson, specialises in estate planning, asset protection, wills, and trusts, and. If this article has raised any questions or you would like to discuss your affairs, then please complete our contact form or call us on 0131 225 1200.
Murray Beith Murray LLP was established in 1849, as advisors for generations of clients, committed to our values of integrity, expertise and trust. This aim and these values continue to this day as does our commitment to be here when you need us.
