I’ve been practicing elder law for nearly a quarter of a century. In the past five years, I’ve noticed an increase in the number of clients who are involved in second marriages. Second marriages create issues when drafting an estate plan that many clients fail to appreciate.
Assume the following: Mr. John Smith, aged 70, married Ms. Mildred Jones, aged 65. John has three children from a first marriage. Mildred has two children from a first marriage. Both John and Mildred wish to provide for the others well-being in the event of their death, then for all their children when both have died.
If this were a first marriage and all five children where the children of John and Mildred, this plan would involve a “simple Will.” John and Mildred each want to leave their entire estates to the survivor of the two of them, then to the five adult children equally. That is the definition of a simple Will; however, when a second marriage is involved, nothing is that simple.
If John dies first and leaves his entire estate to Mildred, Mildred is free to change her Will after John’s death. Mildred might die years after John died, so for all those years, Mildred would be free to change her Will and disinherit John’s children. Obviously, there is nothing that John could do about Mildred changing her Will after John’s death.
If John and Mildred wanted to counter the survivor changing his/her Will, there are few good options. One common option would have John and Mildred dividing their assets, so that Mildred’s assets were in Mildred’s name alone and John’s assists were in John’s name alone. Each would establish a trust in their Will for the other’s benefit.
If John died first, his assets would pass into the trust that he established in his Will for Mildred’s benefit. The money in the trust could be used for Mildred’s benefit for the remainder of her life, then whatever remains in the trust when Mildred dies could pass to John’s children. Mildred’s assets would pass to Mildred’s children when she died pursuant to the terms of her Will.
While this seems like a somewhat easy solution, the devil is in the details. For instance, who would be the trustee of the trust in John’s Will for Mildred’s benefit—Mildred?, one of John’s children?, a combination of Mildred and one of John’s children? If Mildred is the sole trustee, then she has a lot of access to the money in the trust and might use all the money from the trust before she dies. If one of John’s children is the trustee, then Mildred and the trustee might end up fighting as to her need for distributions from the trust. If it’s a combination of Mildred and a child, fights could also ensue.
What about the terms of the trust? Should Mildred have liberal access to the assets of the trust, meaning she is free to use the trust’s assets as she pleases? Or can she only use the trust’s assets if she has no assets of her own? Furthermore, John and Mildred are in love, so when their lawyer (me, for instance) brings up the concept of limiting Mildred’s access to the money in the trust, either John or Mildred, or both, might be offended. Planning is all well-and-good in the abstract, but planning involves real people with real feelings.
Oftentimes, given the seeming complexity of dividing their assets and drafting trusts into their Wills, Mildred and John will opt for simple Wills and trust the survivor not to change his or her Will after the death of the first spouse. As a lawyer for both John and Mildred, I advise them about the ability of the survivor to change his/her Will. In most cases, the survivor probably won’t change his/her Will, but I certainly can see situations where it will happen.
Already, I have had the survivor return to me telling me, for instance, how “John’s children didn’t even show up at his funeral” and how “they don’t deserve to inherit anything from him.”
I can see a lot of estate litigation on the horizon due to these and various other issues arising out of second marriages. If you are in a second marriage, be mindful of the potential issues the marriage creates.