An irrevocable life insurance trust, which purchases insurance on your life and names your children as beneficiaries, is another good estate planning vehicle. Qualified retirement plans, family businesses, and real estate are areas requiring special care. Absent a signed waiver, your current spouse is automatically entitled to certain qualified plan benefits. Even a prenuptial agreement can't guarantee that your separate estate will be distributed according to your intentions unless you establish a system of tracking your separate assets during the marriage. One technique is to set up a separate revocable trust agreement which holds all pre-marital assets and reinvests all their earnings in the same trust.
Estate planning is always tricky.
But, when the process involves a blended family, it's a truly complex matter that involves many potential personal and tax issues. An experienced estate planning attorney can identify the best options and help you see your way through to a happy ending.