You may be like many who fear that your family will dissolve into bickering and perhaps even litigation over your estate when you pass away. Perhaps you know families where this has happened, and you vowed you would take whatever steps necessary to avoid disputes among your loved ones. One important step is creating an estate plan, but even that can't guarantee there will be no disputes.
For those in New York who, like you, hope to leave their family in peace, advisors recommend open lines of communication concerning estate planning matters. This is not always easy, but it can make a difference. Since arguments about inheritance often stem from much deeper family issues, you may be able to preempt any potential battles by discussing the conflicts now rather than allowing them to fester later.
Talk it out
Perhaps discussing finances was something you seldom did with your children. It may have been because you didn't want them to know how you struggled to make ends meet or because you wanted them to learn to stand on their own two feet without relying on your wealth as a safety net. Whatever the reason, your children may have a very different concept of the value of your estate than what actually exists.
This can be a building block for disappointment and bitterness during probate, especially if your children are expecting a much greater inheritance than they receive. If you plan to divide your wealth among your children, grandchildren, charities and other beneficiaries, it is important that your family understand your intentions to avoid unpleasant surprises that may spark conflict.
Other ways to avoid conflict
While you may have a very clear idea of how you want to distribute your assets, some estate planning experts offer some ideas to minimize the potential for confusion, frustration and hurt feelings after your passing, including:
- Don't use your estate plan to reward or penalize your children for their successes or failures. Giving each child an equal portion of wealth will avoid any feelings of resentment.
- Have a logical reason for choosing one child over the other for your executor. Be sure to name your executor in your estate planning documents.
- If you made loans to any of your children, your estate plan should detail whether the loan is forgiven upon your death or whether the child must pay it to the estate.
- Designate the recipients of sentimental objects. These may stir more conflict among your heirs than money.
This is another topic you can broach in your family meetings. You may be unaware how special a certain piece of jewelry or other item is to one of your children. By opening the floor for your children to speak, you will be better able to create an estate plan that is satisfying for you and comforting to your family.