Estate Planning Strategies to Prevent Conflicts between Children

Estate Planning Strategies to Prevent Conflicts between ChildrenWhen people consider how to best bequeath their legacy to loved ones, an important consideration is maximizing the available legacy and preventing conflict between their kids to whom they leave their assets. This issue is an increasingly important issue as many baby boomers focus on developing estate plans. It has been estimated that baby boomers will leave approximately $30 trillion dollars to beneficiaries according to a report in AARP magazine, so there is a significant amount at stake when drafting estate planning documents. Our Las Vegas, New Mexico Estate Planning Attorneys have provided some tips for preempting future conflicts between beneficiaries.

Balance Roles to the Degree Feasible:

While there is no requirement that assets be left equally among one’s children, the degree to which this is feasible will tend to minimize conflict. Although this may seem a fairly obvious approach to minimizing disputes, the same principle applies to allocating the responsibility for handling one’s estate. Kids may interpret being excluded from involvement in settling a parent’s affairs as a statement about levels of trust, capability, and competence. There may be valid reasons not to distribute responsibility equally, but an effort to at least include all children to some degree can prevent feelings of being slighted that may lead to conflict between family members.

Communicate Plans and Set Reasonable Expectations:

AARP reports that a Fidelity Investments survey revealed that many kids have limited understanding of their parents’ estates and what to anticipate they will inherit. The study found that kids underestimated the value of their parents’ estate by an average of $100,000. While parents do not need to reveal more about their finances than they are comfortable disclosing, parents can create realistic expectations and reduce stress that leads to conflict by providing some idea to their kids of what to expect.

Avoid Delegating the Distribution Process:

Parents can reduce conflict by making the determination as to how their assets will be divided between beneficiaries as opposed to appointing a child to make these decisions. If the plan is to have all kids inherit equally, the best way to accomplish this is to spell out this intention directly rather than list one child as a beneficiary and assume that the designated child will divide assets equally. With specific collectables, antiques, jewelry, heirlooms, and similar items, estate planning documents should specifically designate who will receive each specific item.

Consider Explaining Unequal Distributions:

Sometimes there are good reasons to divide one’s estate unequally between kids, so future disputes may be prevented by discussing reasons for such an unequal division. For example, one child may have special needs or a child may have substantially more net worth than other kids. If you discuss this with your kids or leaving some instructions or explanations that accompany your estate planning documents, this can prevent misunderstandings later.

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The above information is designed solely to illustrate general principles of law, and does not constitute a specific legal opinion on individual cases. We suggest that you contact experienced legal counsel for a specific opinion tailored to your individual circumstances.

While these general tips may be helpful for many, every situation is unique, so the best option is to seek legal advice. If you have questions or concerns about any aspect of estate planning, our New Mexico Estate Planning Attorneys at Life Leaf Legal Group, PC offer a free consultation in our centrally located offices in Santa Fe and Albuquerque so that we can discuss your specific situation. Call us today to schedule your free consultation at (505) 856-3591 to learn about your rights and options.

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