If your assets, left to your spouse at death, were to be commingled in joint accounts with a new second marriage partner, your assets could conceivably be distributed by someone you never knew to someone you never knew, and may not go to your children and grandchildren as you had originally intended.

It can be a challenge when doing estate planning to provide security and continuing support for your spouse, or second spouse, and at the same time assure your estate goes to your children.

Or if you have remarried yourself, how to provide for the support of your second spouse should you pass away.

Did you ever wonder what your husband or wife might do with the savings you’ve accumulated together if your spouse were to outlive you and remarry?

One possible solution to this concern is a Qualified Terminable Interest Property Trust, or QTIP, which can be drawn up for you by an estate planning attorney.

Assets put into the QTIP produce and distribute income during the remaining life of your surviving spouse. However, ability to spend the principal is restricted, and the beneficiaries cannot be changed. This also eliminates the worry that old age, dementia, or family issues might result in a beneficiary change that excluded some or all of your children. Most QTIP trusts, though, allow some portion of the principal to be spent in cases of special circumstances, such as medical or other emergencies – with trustee approval.

The QTIP trust can be set up and funded while you are still living as an irrevocable trust, which can have the added benefit of effectively reducing death taxes. Alternatively, it can begin at death as part of the instructions in your will or living trust. A trustee needs to be selected for a QTIP; this can be a family member or trust company; you can also appoint multiple trustees and successor trustees.

Upon the surviving spouse’s death, estate taxes are paid and the principal goes to the children or beneficiaries originally designated. In terms of appropriate investments, income producing securities such as bonds or bond funds make excellent assets for QTIP trusts. Assets that do not generate income, such as raw land, or stocks that don’t pay dividends, are not as attractive.

A lifetime irrevocable QTIP trust is appropriate for some second marriages and some first marriages. They allow the security of knowing your children, grandchildren or other beneficiaries will ultimately inherit your assets after you are gone, and at the same time assure that your first or second spouse will have comfortable support and income for life. Each particular situation is unique and must be drafted by an estate planning attorney in your state.

Elizabeth Loda, certified financial planner, and Steven Weber are senior investment advisors for The Bedminster Group, providing investment, estate, financial planning and brokerage services. The information contained herein was obtained from sources considered reliable. Their accuracy cannot be guaranteed. We want to thank Richard B. Allen, attorney at law, for his contribution to this article.