Proactive Steps Are Paramount in Estate Planning
The death of a parent is an emotionally-charged time when rational decision making is impaired. For some, the tragic event unites siblings. In other situations, brothers and sisters find themselves at odds, particularly when it comes to inheritances that are not equally divided.
Estate plans go beyond the distribution of assets. Parents should consider the ramifications of their written words from “beyond the grave.” Favoring some children with more money and property while leaving smaller amounts to other offspring could create resentment, damaging relationships during an already difficult time.
The Challenge of Fairness and Equity
Being “fair” to surviving loved ones is nebulous at best and dependent on family dynamics. Achieving a balance can take a variety of forms. One child may have taken over the family business while another provided care for their elderly or infirmed parents and even welcomed them into their homes. Conversely, a child with financial problems loaned by parents while they are still alive can be fairly deducted. Siblings who have current and future money-related needs or enjoy significant wealth should be accounted for as well.
No one wants to plan for a time when they are no longer alive. However, when it comes to children, time should be considered of the essence to communicate with them. Whether in writing or in person, parents should be clear about their children’s inheritance and provide specific details and motivations behind their decisions.
A back-and-forth discussion can make all the difference. Putting if off or refusing to relay the reasons for distributing assets can damage, if not end relationships. The death of a parent may be only the start of more tragic events that lead to an irreparably broken family unit being the legacy left behind.