Should you involve your
adult children and other potential heirs in your estate planning? The
decision is a personal one and unique to each family or relationship.
But you have good reasons to talk with heirs before and during estate
planning so you can find out a few important things. What are some of
these things? Here are five important subjects to address before
drawing up your documents.
1. What Is the
Interest in a Family Business?
If you plan to pass on
any sort of business, organization, or enterprise to heirs, find out
how they really feel about receiving it. Many family business owners
are dismayed to discover after years of planning that their kids
don't actually want to continue the business. Others never found out
the truth before their family inherited the business.
Instead of assuming
what your heirs want, talk to them frankly about their options. If no
one wants to - or can - take over the enterprise, you will have time
to make other arrangements. You might prepare the business for sale
after your death instead and plan to divide the assets among your
heirs.
2. How Will People
Feel About Your Division Plan?
As the owner of your
assets, you have the right and responsibility to decide how to divvy
up your assets. But it's a good idea to talk with family members to
see how they would feel about the specifics of how much you will
leave various people and why. For instance, if you plan to leave more
money to your adult child who has children than to the one who
doesn't support a family, how will both parties feel about this?
3. Who Wants to Be
an Executor?
The job of carrying out
your wishes is one that you must delegate. So, who do you want to
take the job of executor? And, just as importantly, do they want the
responsibility? Talk with any potential candidates before putting
this delegation in writing so that both of you are on the same page
about the job. Discuss what family conflict may occur, how the
process works, and where they can find help.
Once you choose an
executor, keep them updated about where your documents are kept,
changes you've made, and potential trouble spots. The more
information you share now, the easier their job will be later.
4. How Involved Do
Heirs Want to Be?
The executor isn't the
only person who could be involved in carrying out your wishes. If you
want to leave money to charitable organizations or create a bequest
or foundation, for example, do your adult children want to be
involved? Would this be too difficult for them emotionally? Or do
they even have any interest in handling things personally? When you
know how people feel, make appropriate arrangements.
5. How Will
Beneficiaries Prepare?
If your estate is
significant, talking with beneficiaries gives you a chance to find
out how they might prepare for the inheritance and what they plan to
do with it. This is an opportunity to help them make a good plan that
fits their interests.
Say you have a
spendthrift child who doesn't plan to seek out financial guidance.
After talking with them, you may opt to use a trust for their
portion. Or if an adult child doesn't know what to do to prepare, you
could help them meet with a financial planner. And if one of your
heirs has an admirable goal, you might even decide to fund it further
in your will.
Even though discussions
about estate planning are often hard, they are valuable. When you
know your heirs' and family's feelings on certain subjects, you can
make a better and more appropriate estate plan. Learn more about
these and other vital conversations by meeting with The
Law Office of Carla D. Allen
today.
