by Curry Andrews
Have you ever seen a family meltdown over inheritance issues right after or even during a funeral? I have seen it happen far too often. Generally, a portion of the family will feel as though someone is being favored or someone has taken advantage or someone is disgustingly greedy.
In reality, it’s usually financial desperation and the behavior that follows when someone is stressed out over money.
Clients have asked me how they can assure their heirs won’t get into huge family-destroying battles over their assets. Here are a few items that can help reduce the potential for family conflict:
You really have to put in place a firm, comprehensive estate plan – a qualified estate planning attorney can help with this. You need all the documents working in harmony and a clear transition in terms of who will be your heirs and who gets what. Additionally, plans may include the “why.” An example would be why one heir gets the family farm or business and not everybody. The plan will also outline who are the fiduciaries—the people in charge of carrying out the plan when you are gone.
Sometimes clients will add an heir to their checking and other accounts. They are thinking it will streamline the process during their incapacity and after they are gone. Usually, however, all it does is cause trouble. Under the law, when you add someone to your account, it makes them a co-owner…but after death unless you have specifically given that account to them, they should hand it over to the estate. So what happens if they’ve already spent it or don’t want to hand it over? It’s best to remove your heirs or fiduciaries from your accounts and only allow access through a valid Power of Attorney. This removes any question of ownership and requires those who are accessing your accounts to be treated as responsible custodians rather than co-owners.
Avoid shortcuts like estate planning documents pulled from a website or handwritten or self-produced wills and trusts and deeds. These will almost always result in court action because they are either “cookie-cutter” documents, which don’t really express your wishes or fit your circumstances or they are invalid in the first place.
Take the time to consult with an expert so you understand what the process will look like if you are incapacitated or your estate has to pass through probate or trust administration. Know the ramifications of long term care and Medicaid and how this will impact your heirs and your estate.
We want to leave a happy legacy to our heirs. If it’s not done right, however, the only thing you transition might be a legacy of conflict and enormous court costs. Instead, I recommend that you promote family harmony by planning ahead with the information you need and a solid estate plan.
Thanks for reading!
Read more in this week's print edition.Subscribe Today!