She bought her $3m home in the 60s. Now her stepchildren want a cut

Monday, 2 March 2026

Retirement questions Answered: from time to time, we will pick a question sent in by a reader and offer a response from writer Gill South. You can submit questions below.

Many of us are members of blended families, one way or another – I became part of one in adulthood which has been a really positive experience. My step siblings support my stepmother in taking care of my father for which I’m incredibly grateful.

And I certainly have zero expectations of inheriting any part of the home that my father and stepmother share if Dad goes first. But that wasn’t the case for a reader who sent in a question in recently.

Meredith* was the stepmother of several children as well as having her own, and she says the pressure to sell the family home she shared with her husband, and distributing the proceeds, started at her husband’s funeral. For the past three years she has fought legally not to sell her home.

Her house, now worth around $3 million, was bought in the late 1960s with her money, as Andrew*, was in financial disarray after a marriage breakup. This house became the blended family home.

Meredith says she was the executrix (love that word) of his will, and that no probate was needed for his small estate. Andrew had been contributing to trusts for his children and grandchildren for years – and had told them that this would be their main inheritance.

But as the increasingly unpleasant legal letters from let’s call them “the steppies”, accumulated, accusing her of hiding money, and telling her to sell the house and distribute the proceeds, Meredith went through four lawyers who gave her opposing advice.

The steppies have finally stepped back, though Meredith, a feisty octogenarian, was prepared to go to court. Meanwhile she has taken her husband’s children out of her will, and it’s all very sour.

Her question, after relaying all this is:

Can I put my home into a joint tenancy with my surviving adult child so he inherits it? Do I need a trust?

I put Meredith’s whole sorry story to Elizabeth Heaney, a partner with Tompkins Wake, who specialises in relationship property and estate disputes. She told me when a person dies there are three main 'legal paths' family members use to ask for money:

• The Relationship Path (Property Relationships Act – PRA): 'Half of that house was actually my dad's, and now his kids want his half.'

• The Support Path (the Family Protection Act – FPA): 'My dad had a duty to look after me, and he didn't leave me enough.'

• The Promise Path (The Testamentary Promises Act – TPA): 'Dad promised me I’d get the house if I helped him out, and I want him to keep that promise.'

Meredith used her own separate property to buy the family home – at a time by the way, in the 60s when women couldn’t get a mortgage on their own.

In New Zealand, the house you live in as a couple is treated differently than any other asset. Even if Meredith bought it with her own money before the relationship, the moment it became the 'family home,' it legally belonged to both of them 50/50.

For the stepchildren to get a cent from that $3 million house, they would have had to pull off a difficult three-step plan.

First, they’d have to convince a judge to kick Meredith out as the 'executor' (the person in charge of the Will) because she has a conflict of interest.

Then, they’d need a new, neutral manager to sue Meredith’s ownership of the house, arguing that half of it actually belonged to their Dad (Andrew).

If they won that fight, that 'half-share' of the house would be moved into a pile of money (the Estate) where the stepchildren could then legally grab their slice.

These are a lot of hoops to jump through, says Heaney.

If Andrew had made provision for the claimants with separate trusts, this would have been taken into account in determining if they had been adequately provided for. This could have been why the steppies eventually discontinued their proceedings, Heaney says.

If you take anything away from Meredith’s experience, and have a blended family, estate planning arrangements need to be done with particular care, says Elizabeth.

To avoid this horrible situation, the estate disputes lawyer suggests having testamentary intentions (a chat about who gets what) with family early, when hopefully everyone is getting on, and not grieving. And have a well drafted, current and properly executed will.

Heaney recommends a “contracting out” agreement which can be done at any time to preserve your separate property for your children if you die and can help protect your partner from relationship property claims by your children after your death.

As for Meredith’s question on setting up a new trust for her child, Elizabeth says transferring her property to a trust could prevent future claims from the steppies because there would be nothing in her estate to claim. But transferring property to a trust can in fact expose people to claims from partners under the PRA and spouses under the Family Proceedings Act.

Transferring property to a trust would also mean that Meredith would not be able to use that property solely for her own benefit, she would have to consider all of the beneficiaries, and there could also be financial and compliance consequences.

Meredith could also transfer the property to herself and her son as joint tenants so that that it doesn’t form part of her estate and passes to him as the surviving joint tenant on her death.

Of course, if Meredith were to transfer the property to herself and her son as joint tenancies, that would mean she would lose sole control over the property, and it wouldn’t solve her problem if he died first.

It may not be necessary for Meredith to do anything at all, says Elizabeth. The stepchildren would likely have difficulty claiming against her estate anyway because to be eligible under the Family Proceedings Act, they would have to show they were in some way dependent on Meredith immediately prior to her death, or entitled to be so. And let’s face it, that seems highly unlikely given their relationship breakdown and they must be in their 60s or so by now.

In all of this, take legal advice, says Heaney.

Honestly, the steppies haven’t endeared themselves to me though I realise they may have rights. Most of my friends have pretty low expectations of inheritance from their parents, it doesn’t do you any good to be entitled. Go Meredith, I say.

Gill South is a freelance business writer who has authored a book on personal finance and written for many major publications in New Zealand.

*Disclaimer: The information in this article is of a general nature and is not intended to be personalised financial advice. The names of the individuals in this story have been changed to protect their privacy.