“Three may keep a secret, if two of them are dead.” – Benjamin Franklin
Whether 40 or 70, you’ve finally decided to complete your estate plan. You review your assets with an estate planning attorney and begin to explain how you want your assets distributed upon death.
If you have children and there are no negative relationships or other legal impediments like a disability or incapacity issue, your bequests may seem simple. The popular choice is to leave assets to children equally. However, it is always worthwhile to drill a bit deeper into how these scenarios may play out.
To be clear, leaving things equally to children may be a perfectly logical and fair way of distributing your assets. I’ve heard many clients say they do this “to keep the peace” and to avoid resentment among siblings. However, family dynamics, as well as your children’s assets, can vary greatly.
Is one child very well off, financially astute with no children and another a divorced or widowed single parent with several young children to care for? Issues of entitlement and “spoiled” children aside, equal distribution in these scenarios may create resentment and bad feelings.
If one child has a passion for hobbies that you also enjoy like hunting, music, antiques, artwork, etc., that can be an important factor when balancing bequests to your children. These scenarios lead to another important question: Do you inform your children of your final wishes or even include them in the estate planning process?
Ideally, open communication goes a long way toward resolving future conflicts and resentment. “Open” in this context means all present must be willing to communicate honestly about their feelings, which may be difficult for some.
Children that are overtly hostile or who are estranged can not only be excluded from the decision-making process but can be excluded from bequests entirely “for reasons personal to me” or similar language. Likewise, if a child is difficult, manipulative and over demanding, inclusion of that child in the estate planning process would probably be counterproductive, if not destructive. However, where the parent-child relationship is positive, one should consider the benefits of including children in the process.
A common issue to examine is whether any children are interested in the family home, camp or other properties — presuming they are still owned by a parent at death. I’ve seen estate plans change quickly when a child speaks up and surprises everyone by saying they want to go back to their original family home.
Keep in mind that the thought of “taking over” someone’s assets after their death can be a very uncomfortable subject. An estate planning attorney would hopefully create a more comfortable atmosphere to express practical concerns and end of life wishes. An estate plan can contain options such as allowing one child the “right of first refusal” on a property or the right to use his/her inherited share toward its appraised value.
Valuable personal property — whether sentimental or monetary — such as vehicles, ATVs, collectibles, heirlooms, sports memorabilia, jewelry, guns, musical instruments or furniture, should also be examined. It can be productive to discuss whether such items have meaning to your children.
Perhaps personal property with sentimental value can go to a wealthy child, while a child with more financial needs can get a larger percentage of liquid assets. In contrast, where it is known disagreement over items may occur, equal distribution is a way of either having the beneficiaries come to an agreement over such items or to sell and split the proceeds equally.
Including children in your estate planning process when relationships are open and positive can not only be fruitful but serve your legacy for generations. There may also be very justifiable reasons to keep your final wishes between just you and your attorney.
Ultimately, the choice is up to each individual in the context of their family dynamic, whether positive or negative. The key to any quality estate plan is to honestly explore these dynamics to best meet and serve your individual wishes and those of your loved ones after you are gone.
This article is for informational purposes only and should not be construed as legal advice. James S. Rizzo is an attorney with the law firm of Rheinhardt and Bray, P.C., with offices in Rome, Ilion and serving the Central New York area. He has more than 25 years of legal experience and concentrates in Estate Planning matters including Wills, Revocable and Irrevocable Trusts, Powers of Attorney, Health Care Proxies, Asset Protection, Nursing Home/Medicaid planning & Probate issues.
He can be reached at 315-339-0503 or firstname.lastname@example.org for a confidential, initial consultation. Visit them on the web at: www.CNYElderLaw.com.