Death of a Spouse: The Case of Fred and Julie Sampson

Feb 23, 2021
Estate Planning Trust Administration

The idea of losing your spouse to death may be very painful. However, death is a reality of life and you must take all possibilities into consideration when attending to your estate plan. This is especially salient if your partner is ill or it is otherwise apparent that he or she is likely to die before you do.

While these circumstances are not easy, it is advisable to try and plan in advance if at all possible. If your spouse has already died, however, there are ways to minimize the effects on your estate. Particularly if you have set up shared revocable living trusts, managing these in the wake of your spouse's death is paramount. Take the case of Fred and Julie Sampson. Fred was older than Julie by 10 years, and eventually died after a long battle with prostate cancer in 2018. This left his grieving spouse Julie to manage their shared revocable trusts alone.

How do shared revocable trusts normally work? 

Like with many married couples, Fred and Julie opted for shared revocable trusts to put their property in, so that they could pass their home and investments easily to their oldest adult child when they both died. While both Fred and Julie were alive, they were both co-trustees and co-beneficiaries of the shared trust. Thus, when Fred died, Julie became the sole beneficiary of the trust and thus legally became the so-called “surviving trustee.”

What can a shared revocable trust do? 

Shared revocable trusts are a very good plan for couples like Fred and Julie, where even without the influence of cancer it was highly likely that Fred would die before Julie just due to age. Fred and Julie lead a “traditional” lifestyle where Fred was the single income-owner, working outside of the home, and Julie was a homemaker. The existence of the shared revocable trust meant that Fred could ensure that his investment portfolio and home would pass to Julie without incident upon his death.

Additionally, Fred and Julie did discuss the possibility of either of them getting remarried in the event that one predeceased the other. In this instance, since Fred passed away first, the shared revocable trust provides a way for Julie to hold on to Fred's assets even if she decides to remarry. Not only does this protect Julie, it also protects Julie and Fred's children. Normally, if Julie decides to remarry, this would bring the potential heirs of a new spouse (for instance, if Julie's theoretical new husband has children of his own) into the picture. With the shared revocable trust, Fred was confident that his children would receive their inheritances as he intended, without Julie's potential new marriage confounding the issue.

What are some other options? 

A shared revocable trust is not the only way that individuals can prepare for the death of a spouse. For instance, some couples prefer to simply create separate living trusts so that they can manage their assets as they prefer. Contact us at AmeriEstate to learn more about how we can help you prepare for the inevitable.