Successfully blending two families together can be a struggle. Regardless of whether parents remarry due to a previous divorce or the death of a spouse, the new blended family will experience occasions that are awkward at best. Even blended families that have adjusted well will encounter challenges from time to time. Many parents of blended families have found that problems can often be avoided or lessened by planning ahead and talking about potential pitfalls before they occur. If you are over 50 years of age with a blended family, you should talk to your spouse about life insurance and the beneficiaries of any policies.
Under normal circumstances, life insurance is intended to ensure that your spouse and dependent children will continue to maintain a similar lifestyle after you are gone. Life insurance money can be used to pay a mortgage, finance children’s education at a university, pay for future weddings, and to assist the remaining spouse in paying living expenses. Basically, life insurance is a way to make sure any dreams and goals you have set for your family will continue to be a possibility if you aren’t there to help.
By the time most people reach their fifties, their finances have stabilized. Their children are out of the education system, and they may even have families of their own. Many people in their fifties have paid off their mortgage. They probably have cash in savings and are thinking about what they will do when they stop working in 10 to15 years. For many people in their fifties, the reasons they originally chose to buy life insurance no longer exists. Sure, people in their fifties still want their spouse to have a reasonable income after they die, but in many cases, the spouse’s financial needs have been drastically reduced. With a single-marriage family, a person’s fifties is a time when they might want to consider reducing their life insurance. However, spouses in a blended family may want to reconsider that thought.
Although life insurance is not intended to serve as an inheritance, parents in a blended family may want to consider life insurance as a way to make sure their children get at least something after they die. While both you and your spouse may intend to share your estate equally with both children and stepchildren after you are gone, situations may change. Once you are dead, your spouse could change their will, and any stepchildren could be disinherited. The same thing could happen to your stepchildren if your spouse dies before you. Even with the best intentions, no one can guarantee what will happen after you are gone.
In the case of a blended family, a possible solution might be for both spouses to get an additional life insurance policy with their children as the beneficiaries. This would guarantee each other’s children get at least something if their parent dies. Having a life insurance policy made out to your children does not mean they would not share in their stepparent’s estate after both spouses are gone. However, it does mean that even in a worst-case scenario, each spouse’s children would certainly get at least some financial recompense for the loss of their parent. Naturally, you will also want to take care of your spouse, but that can be done with separate policies if desired.
For the most part, spouses in blended families can trust each other to share their estate with both their children and stepchildren after both spouses are gone. However, a quick search on the Internet will quickly reveal situations where relationships in a blended family significantly deteriorated after the death of one of the spouses. Almost all of the relationship problems occurred because one or both spouses failed to make a will before they died, or their spouse’s will was changed to disinherit their stepchildren after the death of their spouse. Having your children as beneficiaries on a life insurance policy can help avoid hurt feelings in those situations.
Not everyone in their fifties can afford an extra life insurance policy for the benefit of their children. However, for those who can afford it, a life insurance policy can help ensure peace in the family after you are gone.
Sam Jones the author of this article suggests readers visit uSwitch.com for personal finance advice with regard to over 50 life insurance.
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