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Changing Family Structures Impact Estate Planning

Family structures and dynamics have changed drastically over the last several decades. The New York Times reports that the birthrate in the U.S. is half of what it was in 1960. Fewer women are having children – 10% fewer women are having children than in the 1970s, and 41% of children are born to unmarried mothers. Over 25% of these unmarried mothers are cohabitating with a partner, though that partner is not necessarily the parent of the child. Women who are having children are also having them later – the average age of a first-time mother is nearly 26.

Marriage is occurring later in life, with the age of first marriage near 29 for men and near 27 for women. While the divorce rate has declined in recent years, it remains above 40% for first-time marriages. Notably, the divorce rate has increased among baby boomers and is now above 50%.

Family Dynamics and Estate Planning

The American family is dynamic and there is no such thing as a “typical” family anymore. Dealing with decisions and legalities surrounding marriage, childbearing, child-rearing, divorce, and remarriage can often be more complex than people realize. Aside from dealing with family law, soon-to-be-married and soon-to-be-divorced people and parents need to assess how their familial changes impact their estate plans.

According to the Wall Street Journal, the case that most demonstrates the way that family law, marriage, and divorce impact one’s estate is that of Robyn Lewis. Ms. Lewis first executed a will in 1996 that named her then-husband as the primary beneficiary and her father-in-law as an alternate beneficiary. After she divorced her husband, New York law automatically invalidated the devise to her husband in the will. When Ms. Lewis died in 2010, the 1996 will was admitted to probate by her former father-in-law, who was now the beneficiary.

There was some confusion about whether or not Ms. Lewis attempted to execute a new will at some point after her divorce, but this case highlights the complexities involved in estate planning after marriage or divorce, and the importance of addressing estate planning clearly during life changes.

Family Law Documents May Impact Estate Planning

It’s important to understand that some of the legal steps taken in preparation or during marriage or divorce can impact estate planning.

Premarital Agreements can be used for estate planning. According to the Wall Street Journal, as people marry later in life, they enter into premarital agreements to keep assets separate. Ensuring that certain assets are not commingled with marital property can impact what happens to that property upon the owner’s death. In addition, premarital agreements may override a will, or certain terms in a will, that was already in place, or may be used as evidence to contest a will.

Postmarital Agreements can operate in much the same way as a premarital agreement; the only difference is that it is entered in to after the marriage has already taken place, instead of before the marriage.

Shared Property Agreements, also known as cohabitation agreements, allow unmarried cohabitating couples to enter into agreements that are similar to premarital or postmarital agreements. According to the New York Times, the agreements generally address property ownership and division of finances. They can be used to either ensure that certain property or finances are kept separate, or, on the other hand, to ensure that both parties have rights to certain property or finances.

If you are about to get married, have a child, or considering ending a relationship – or if you have questions about how your structure impacts your estate planning – it is important to speak with an attorney with experience in estate law to understand your options. The attorneys at the Millhorn Law Firm have experience working with blended families and understand the ways in which family changes can impact your wishes. We can speak with you, understand your goals, and help you make sure that all of your needs are met.

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