Financial and estate planning for blended families

Many Canadian families are still of the 'traditional' kind but blended families are on the rise...

Many Canadian families are still of the ‘traditional’ kind but, according to Statistics Canada (StatsCan), their numbers are declining while those for blended families are growing.

The 2011 Census included stepfamilies (StatsCan’s term for blended families) for the first time, and according to the Census stepfamilies now represent about one in eight families with children.

Money matters are often a challenge in any relationship, and they become even more challenging in the case of a second (or third) marriage or common-law relationship, especially when they include children from previous and current relationships.

Here are some points to consider:

• If you and your partner have separate financial plans, it’s important that you come together and develop a cohesive plan that will help best attain your new family’s objectives.

• Determine how you are going to treat all your children equally.

• Establish an RESP for every child that does not already have one.

• If you and your partner designate each other as the direct beneficiary of all of their assets, when one partner dies, everything goes to the survivor, potentially disinheriting the children of the deceased spouse.

And, if the surviving partner should remarry, the new partner could become entitled to the estate (or a large portion of it) which could disinherit not only the children of the deceased partner but even the children of the survivor. For these and other reasons, a standard will is not recommended for a blended family.

Other strategies include dividing the estate at the time of death of the first parent or using a spousal trust to protect the assets for both families. It’s crucial to speak to your legal adviser regarding a will with terms appropriate for your blended family.

• Similar problems can arise from jointly held property. Many couples choose to hold property jointly so title passes automatically to the survivor on the death of the spouse and avoids probate fees (this does not apply in Québec).

But if you have children or other dependents from a previous relationship and want them to share in the value of your property, then holding title to the property jointly with the right of survivorship isn’t recommended. Speak to your legal advisers regarding ways to hold title to property in a way that benefits your children and carries out your wishes.

Financial and estate planning for blended families is complicated. Talk to your financial and legal professional advisors about the right strategies for your personal situation.

J. Kevin Dobbelsteyn is a certified financial planner with Investors Group Financial Services Inc. His column appears every Wednesday.

Just Posted

Courtenay Day of Mourning ceremony April 28 at Simms Park

In 2018, 131 B.C. workers died from a workplace injury or disease.… Continue reading

Kus-kus-sum receives $1 million in provincial funding

New Democrat MLA Ronna-Rae Leonard is welcoming $1 million in provincial funding… Continue reading

Comox Valley Record putting the call out to Snowbirds shutterbugs

David Suther sent in this great pic of the Snowbirds, shot from… Continue reading

Too Good To Be Threw back in downtown Courtenay with second location

The new store opened Tuesday at 456 5th Street

World Community screens This Mountain Life in Courtenay

The awe that mountainous landscapes evoke is universal. World Community presents the… Continue reading

VIDEO: Driver in bizarre hit-and-run at B.C. car dealership turns herself in

Police believe alcohol was a factor in incident causing estimated $15,000 in damages

Sewer line repair underway at Goose Spit Park in Comox

Wastewater spotted near parking area at bottom of Goose Spit stairs

‘B.C. cannot wait for action’: Top doctor urges province to decriminalize illicit drugs

Dr. Bonnie Henry says current approach in ‘war on drugs’ has criminalized and stigmatized drug users

B.C. woman, 76, challenges alcohol-screening laws after failing to give breath sample

Norma McLeod was unable to provide a sample because of her medical conditions

New report on 2017 wildfires calls for better coordination with B.C. First Nations

Tsilhqot’in National Government documents 2017 disaster and lists 33 calls to action

B.C. youth coach banned amid sexual harassment, bullying scandal: Water Polo Canada

Justin Mitchell can’t take part in Water Polo Canada events or clubs

CONTEST ALERT: Win tickets to A Night of Bowie

UPDATE: Congrats to Angela Dawn, who won two ticketas to the show.… Continue reading

Wilson-Raybould: Feds want to just ‘manage the problem’ of Indigenous Peoples

Former federal justice minister speaks at First Nations Justice Council meeting in B.C.

Woman who was chased and tackled after break-in sentenced on Vancouver Island

Natasha Geraldine Harris, 28, was sentenced to time served and will be released from jail

Most Read