Game of Thrones’​ Lessons on Step-Family Inheritance Planning

So, Game of Thrones is really a 71-episode masterclass on blended or step-family inheritance planning…

The Real Meaning of Game of Thrones

On 19 May 2019, 80 million people tuned in for the finale of the wildly-popular HBO epic fantasy drama, Game of Thrones…only to get sick in their stomachs at the show-runners’ choice of the winner of the throne and a sleight of hand that sent a fan favourite inexplicably plunging into madness.

Winter is come and gone, but the sour aftertaste from the finale stayed in my mouth. Did I go down the rabbit hole for eight score years for THAT ending?

To distract myself, I started on Succession, HBO’s other drama on blended families (a family that includes children of a previous relationship of one spouse or both).

Midway through Succession, it dawned on me that Game of Thrones and Succession were both made to guide blended families on inheritance planning. How else would the finale of Game of Thrones make any sense?

Is it sheer coincidence that both HBO dramas revolve around blended families? The Roys of Succession and the Starks of Game of Thrones grapple with family discord, jealousy, and step-sibling rivalry — and the results of failing to do inheritance planning.

If Succession weren’t about the need for inheritance planning, why else would HBO have named it so? Why else did Game of Thrones’ show-runners have the Starks suffer such disproportionately deep tragedy, financial ruin, and hardship (well, due to daddy Stark’s lack of an estate plan)?

If I seem like I’m trying too hard to cope with life after Game of Thrones, that may well be. But blended families are a part of modern life and are fascinating (why else do Snow White, Cinderella, Hansel and Gretel, Modern Family, The Royal Tenenbaums, Thor, and Ant-Man rely on them so much?). Plus, they need inheritance planning more urgently than traditional, nuclear families, so thank you, HBO, for the public service reminder.

The Challenges Blended Families Face

Asia’s societal make-up has changed dramatically, and the blended family (or reconstituted or step-family), formed by the re-partnering of people after a marital breakdown, is an increasingly common family unit. As people live longer and divorce more often, there will be more blended families.

In 2017, nearly 25% of all marriages registered in Singapore were remarriages for one or both parties. Anecdotally, many of us have friends or family who are in, or who are about to form, blended families.

Two of the Stark family children, Theon and Jon, are adopted or born out of an extramarital affair, respectively, making the Starks a blended family, along with others in the show like the Boltons, Freys, and Martells.

Like real-life blended families, the Starks suffer from complex family dynamics and underlying tensions. Catelyn Stark, the Stark matriarch, never accepts Jon. Resentment and envy bubble under the surface between the biological Stark children and Theon and Jon, who, in turn, never really feel they belong.

Children in blended families often struggle to bond with their step-parent and step-siblings. Everyone grapples with divided loyalties, jealousy, and changes in living conditions. The parents face competition for their affection, time, and finances, between past and present spouses, biological and stepchildren, and biological children and the new spouse.

On top of all that, they face serious estate planning challenges. For example, Theon betrays the family by stealing their heirloom and home, Winterfell, after Ned, the patriarch, dies. When Catelyn dies shortly after, the family is torn apart and suffers financial and physical hardship. The death or disability of a spouse without a good estate plan in place can cause financial ruin and disputes, especially if one group inherits or controls all or most of the assets.

Why Blended Families Need Inheritance Planning

One of the biggest myths in inheritance planning is that all you need is a will or any will. Most couples with children do “simple wills”, which are wills that provide that on a spouse’s death, his or her estate (the assets at one’s death left after paying off debts and expenses) goes to the survivor, and on the survivor’s death, his or her estate is inherited by their children equally.

These are popular due to their simplicity and low cost and may be fine for traditional, nuclear families with adult children, but are disastrous for blended families.

Here are some scenarios to show what may happen if a blended family spouse passes away without a will or with a simple will (let’s assume it’s the husband who passes away first):

• A situation may be created in which children from the husband’s first marriage need to survive their stepmother to obtain any inheritance (because he and the wife did simple wills). This is especially tricky if their stepmother is of the same or later generation as the children. They also get nothing if she remarries (this automatically revokes the will), changes her will to name other beneficiaries, goes bankrupt, or spends all the money.
• Another tricky situation is created if the husband forgets to cancel the CPF and life insurance nominations that he previously made. Divorce does not invalidate these, and on his death, his ex-wife and his children with her inherit his CPF monies and life insurance policy proceeds, which are substantial, not his new wife and children with her.
• Another tough scenario is where he has two adult children from a first marriage and a young child with his second wife. His ex-wife is wealthy and provides for their children, while he struggles as the sole breadwinner. He spent a lot on his adult children’s education. If he dies without a will, his wife gets 50% of his estate, while the other 50% is split equally between the two adult children and the young child. Is this fair to his young child?

These aren’t the only ways that estates are badly distributed, but the result is the same: some get nothing, others, too much, and unhappiness and hardship ensue. They occur because many people prefer doing nothing to avoid the hassle or hard conversations with their spouse. In some cases, if an adequate provision is not received, family members may launch a family provision claim, causing untold delay and distress in an already stressful situation.

How Should Blended Family Inheritance Planning Be Done

Blended family inheritance planning involves the process of designing a plan to ensure that your death or disability does not affect the financial provision that those dear to you — whether from a previous or the present marriage — need.

The products of the design process are legal documents and arrangements like wills, lasting powers of attorney, trusts, life insurance or CPF nominations, and splitting of ownership of jointly-held assets. If the design process is rushed or skipped, the products will likely fail the objective.

Start by examining the financial needs of your spouse and your children from the present and last marriage, against your financial situation. Who needs more provision, and who has already been provided for?

If you were widowed, did your children from your last marriage inherit any money or have a trust set up for them? If your last marriage ended in divorce, is your ex-spouse providing for your children? How old are those children, and how much will they need for sustenance compared to children from your new marriage? If there aren’t enough funds for all, consider life insurance to create funds for the estate, if affordable.

Next, consider a testamentary trust, which is very useful for blended family estate planning. Instead of your estate passing directly to your spouse or children on your death (which creates the problems we mentioned above), it is given to the trustee to hold on trust and to manage for your spouse and children’s benefit, based on the terms of your will. The trust is contained in your will, and is created only on death, and so does not affect retirement needs.

The key benefit of a testamentary trust is that, because assets held in it on your death are not your spouse’s or children’s assets, it protects your estate from their bankruptcy or divorce. By keeping your estate immune from their creditors, spendthrift habits, or ex-spouses, it is preserved for everyone.

Also, if your spouse remarries, his or her new family cannot access your estate funds. It can also be used to give a “life interest” to your spouse so that on your death, he or she receives income and the right to live in the family home for life, and on his or her death, the rest of your estate and the home go to your children from your previous marriage. These are not possible through a simple will. The downsides are that it is not as straightforward or cost-effective as a simple will and requires that you have good guidance.

While many couples appoint each other or an adult child as executor and trustee for their inheritance plans, blended families should avoid this due to the potential conflict between personal interests and legal duties, and possible conflict with other members of the family.

Neutral parties like professional trustees, lawyers, or accountants should be considered, though this may involve additional costs. Apart from independence, the trustee should also be financially savvy and likely to be around for as long as the beneficiaries live.

Next, life insurance or CPF nominations aren’t governed by your will, so if you have made any, these should be reviewed to ensure that they further your inheritance plan. If you have any bank accounts or real estate held under a “joint tenancy” with your spouse, be aware that they are also not governed by your will and go directly to your surviving spouse on your death.

Consider whether the manner of holding of such assets should be converted to a tenancy-in-common so that your share of the asset is part of your estate. Lastly, a lasting power of attorney (LPA) must be done so that if you are mentally incapacitated, your assets are managed to meet your unique inheritance planning objectives. This person should also be trustworthy and independent, just as with the executor and trustee of your will.

Game of Thrones’ Biggest Tip for Blended Families

“When the snows fall and the white winds blow, the lone wolf dies, but the pack survives”, are words Ned Stark leaves his children with; a rallying cry for them to stay together. Ned always reminds his children that he loves them all, whether they are his biological children or not.

While he should have done better inheritance planning, he succeeds at passing down personal and family values of love, mutual respect, and family unity. What other reason is there for the Stark children managing to reunite and setting aside their differences to end up the real victors of the game?

And that is Game of Thrones’ biggest lesson on inheritance planning for blended families. The best legacy you can create is to instil in them the value of family unity and leaving behind not just financial assets but core principles and values.

Read my other article (link below) on how to create such a legacy.

So, about that Game of Thrones Finale

While Ned and Catelyn Stark arguably never had to deal with a will, a testamentary trust, an LPA or CPF, or life insurance nominations, they probably should have! All those years their children spent in the wilderness — avoidable — if they had just sat down for a forthright discussion and inheritance planning session with us!

Catelyn Stark could have at least made a will just to appoint the loyal Brienne of Tarth to be her daughters’ legal guardian on her untimely demise, but enough with the “could have, should have, and would haves”.

Blended families should learn from the Starks’ mistakes and how they instilled family unity and left behind their core personal and family values. So, that Game of Thrones finale isn’t so bad now that we see how it explains why Daenerys failed and Bran succeeded.

Dany was the lone wolf that dies, while the Starks are the pack that survives — strength in unity. Which inheritance would you choose? House Stark’s or House Targaryen’s (doing nothing but leaving someone three dragon eggs and an insanity gene isn’t a good inheritance plan).