Blended Families & Stepchildren — Estate Planning That Doesn’t Blow Up Later

By Attorney Patrick Nolan

People don’t think about estate plans when things are calm. They think about them when they imagine the worst: a second marriage, old resentments, and a house full of kids who suddenly realize the law doesn’t care about “what Dad meant.” That’s where blended families live—right on the line between what feels fair and what the paperwork actually does.

The core problem isn’t fancy. It’s control. When the first spouse dies and everything slides over to the survivor outright, the whole plan tilts. Maybe the survivor remarries. Maybe the relationship with stepchildren sours. Maybe they just rewrite their will on a quiet Saturday morning. Either way, the original spouse’s children wake up one day and find out the house, the accounts—the whole deal—has drifted to someone else’s branch of the family. That remarriage risk wrecks more families than anyone admits. It’s the disaster everyone can see coming but few guard against.

That’s why most serious estate planners push the same tool for blended families: a spousal trust. You’ll hear it called a Deceased Spouse’s Trust, AB Trust, Bypass Trust, or a QTIP. The name doesn’t matter. The purpose does. It keeps the surviving spouse protected, but it also fences off the deceased spouse’s assets so they go to the children they were meant for. It’s the only way to put a lock on the wagon so no one else can quietly pull it into a different driveway later.

Here’s how it works in the real world. When the first spouse dies, their half of the estate drops into an irrevocable trust. The surviving spouse usually gets the income. They can tap principal for health, education, maintenance, and support. They can even serve as trustee, though that’s where most of the trouble starts. A spouse who controls the trust can nibble the principal down over time—sometimes intentionally, sometimes because life is expensive. When one of the deceased spouse’s kids serves as trustee or co-trustee, the guardrails tighten. People behave differently when someone is watching the ledger.

The tough conversations aren’t about mechanics. They’re about division. How much goes into the trust? Should “my kids get my half” and “your kids get your half”? Couples in second marriages carry those questions around like loose tools in a truck bed. They rattle until you deal with them. And then there’s the tax wrinkle—the loss of the second step-up in basis. Protection comes with a cost. Kids who inherit from a spousal trust may face capital gains they wouldn’t face if everything had passed outright. You trade a tax benefit for certainty. Most people in blended families choose certainty.

Retirement accounts make the whole thing even trickier. Beneficiary forms beat every will, every trust, every good intention. If a spouse is named one-hundred-percent on an IRA, nothing stops them from rolling it over, naming their own kids, and cutting the stepchildren out entirely. Equal primary beneficiaries—spouse and children together—solve that problem for many families. Each beneficiary gets their share directly. No one can rewrite the paperwork after the funeral.

And when couples marry later in life, the Power of Attorney becomes its own battlefield. A man in his sixties who spent decades raising his own children may trust his new wife, but he’ll often name one of his adult kids as his financial agent. It isn’t a slight; it’s a practical decision shaped by history.

If someone wants to leave property to stepchildren, the law demands clarity. “My children” doesn’t include stepchildren unless they’re adopted. They must be named outright. People assume intent translates. It doesn’t. The document governs every inch of this.

The hardest part is the emotional math of “fair” versus “equal.” Some families split everything five ways because they see themselves as one unit. Others keep the lines clean—his children inherit his half, her children inherit hers. No judge can tell them which is right. Only the people living in that family know what will keep the peace.

Communication is the quiet safety valve. A parent who sits the kids down and says, plainly, “I’m leaving the house to my wife, and here’s why,” removes the oxygen from future claims of undue influence. It won’t make everyone happy, but it strips away the mystery that fuels fights. That clarity matters more in blended families than anywhere else in estate planning.

Blended families sit in the category professionals call “unique family circumstances.” It’s polite code for: You need a plan built for your exact situation, not a template. They’re complex. They’re fragile. And when people don’t plan, the law fills the vacuum with rules that don’t care who raised whom, who sacrificed what, or what was promised at the kitchen table.

A good spousal trust won’t fix the old wounds, but it will stop new ones from forming. And that’s usually enough.