I recently read an article on “How to Avoid Family Feuds Over Your Inheritance” published a few months ago in next avenue.org, (link below) and decided a short, basic list of things to think about for those reading this entry might be helpful. If you’re concerned over family members fighting over inheritance when you’ve passed away, start by thinking about these three basic things:
First – Be as “fair” as you know how to be.
There are many definitions of “fair,” depending on your family and the circumstances. But, we all of us can probably come up with a reasonable expectation of “fair” that fits our family’s understanding. Families don’t always realistically think through what their assets entail, who should get what, and why. Sometimes what goes wrong is not about being “unfair,” but rather involves faulty or incomplete memories of what has taken place during our lifetimes. Sometimes we forget, for example, about that life insurance policy for which we already have a beneficiary. Or, we forget that the youngest son has borrowed a large amount of cash to start his business and not paid it back yet. Another typical “hot button” is a forgotten large gift or “advantage” of some kind given to some but not all of a group of children or grandchildren (maybe help paying for a college degree for one child but not all, or gifts for one set of grandchildren but not all). If you don’t think carefully and thoroughly about your assets, to whom they should be distributed, and, most importantly why(!), you’re risking a simple mistake of memory or paperwork – and, this mistake can lead not only to fights and disagreements, but unnecessarily hurt feelings, or worse.
Second – Keep track.
Obviously, step one leads to the need for step two. Keep track of your assets, your family members, and the transactions that may affect your gifting or distribution plans. Each person should come up with a method of keeping track that is simple, straightforward, and easily updated as things change. It can be a public or a private document – you decide. Sometimes, a simple excel spreadsheet can help keep track of amounts, dates, and type of gifts, loans, financial investments, and beneficiary policies and accounts. Keep that information with your other legal documents. This ensures you and your family members can see how you’ve carefully tracked what assets are going where and how. This is also often helpful in resolving the typical dispute of “that’s not fair” – it takes away the assumption that you just didn’t notice what you were doing when you appeared to give the second daughter more than the first. Another way to handle unforeseen “fairness” issues is to articulate and document how you would wish any disputes after your death to be resolved. This offers a forum that could dramatically alleviate, or even eliminate, the issue altogether.
Additionally, I encourage my clients who are creating or updating their wills to make a written list of tangible personal property; sometimes it’s not the money that causes the fight, but the personal item which someone hoped you’d remember really meant a lot to them – a piece of jewelry, a photo, a piece of furniture that’s been in the family for generations, etc. Most attorneys write in a clause under the “specific gift” article in their will drafts that allows you to create such a hand-written list (as long as it’s signed and dated, and the item and recipient are clearly identified).
Third – Thoughtfully consider each person.
Communicate with family members about your plans, your plan’s methodology, and/or the reasons for your plan. It’s not always easy to talk to your family – if that doesn’t work, make sure your thoughts are communicated in other ways, like written explanations included with your legal documents.
Take the time to thoughtfully consider who you consider “family” and under what circumstances they will be recognized in your distribution plans. And, don’t forget to think through for what reasons they should be included in your plans. Are the in-laws all included? What if some of your children don’t survive you? How about your siblings? The divorces and remarriages? Once you start thinking about it, your list may get longer (or shorter!). But, every time you thoughtfully think about each member of your family, you can start to see from their perspective, perhaps, what would be considered “fair” and why. This process can avoid many potential misunderstandings after you’re gone.
Most attorneys will assist you in defining and articulating your wishes, and coming up with various scenarios to assist you in planning for many possible outcomes. Estate plans are for everyone – young, old, black, white, male, female, and wealthy or poor. If you have an estate plan already and want to revisit its appropriateness, or if you don’t have one and would like to start thinking through your options, make an appointment with an attorney who can assist you with your estate and family inheritance planning.
This blog is written by Bridget-Michaele Reischl, Attorney DECORO LAW OFFICE, PLLC www.decorolaw.com
ALL READERS: This blog is not, nor shall it be deemed to be, legal advice or counsel. This blog does not create an attorney-client relationship with any reader. It is designed to encourage thoughtful consideration of important legal issues with the expectation that readers will seek professional advice from a licensed attorney.Contact Bridget-Michaele Reischl at: DECORO LAW OFFICE, PLLC 6 West 5th Street, Suite 800-D Saint Paul, MN 55102 (651)-321-3058 [email protected]