Broker Check

When Wills Become Won'ts

| June 12, 2018
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The children of Baby Boomers stand to inherit the largest amount of wealth in history.

This transfer of wealth will surely lead to many happy, and some not-so-happy, recipients. 

A recent article in Financial Advisor Magazine noted the difficulty that many families face with their estate planning due to divorces and remarriages. Often the most feared “creditor” of an estate is the “future ex-son/daughter-in-law!”

 Among the report’s findings:

  • 40% of beneficiaries thought the distribution of their parents’ estates was unfair.
  • 28% of intended heirs said they knew the details of their parents’ distribution plans.
  • 40% of parents surveyed have never discussed their estate plans with their children, and
  • 25% of married adults indicated that only their spouse knew the location of their estate documents.

Without planning, feuds can ensue with family members when they feel they didn’t get their fair share.  But what is “fair?” Often an equal split makes sense, but what if one child received significant support during his or her parents’ lives?  What if one child is wealthier than the parents? The definition of “fair” is clearly a moving target and, without a healthy discussion  ahead of time, dissension among siblings becomes more likely. In talking with our clients about their estate plans, we have found that the single biggest fear that most parents have (especially mothers) is that their children won’t be as close with each other after Mom & Dad are gone as they were while Mom & Dad were alive.  A well-documented and discussed estate plan can help with that.

At SRQ Wealth, we encourage open communication between parents and heirs to set expectations and avoid potential conflicts.  Holding family meetings for the purpose of reviewing the family legacy plan is a good way to bring the entire family together. Sometimes these meetings are a chance to discuss issues that are more sentimental in nature.  Often, it’s not dividing the financial assets that causes the biggest problems; it’s the personal belongings that have a special meaning for family members. 

This is such a big issue that an entire book and workshop has been written about it called “Who Gets Grandma’s Yellow Pie Plate?” to provide families with practical information about the transfer of non-titled personal property. At a family meeting, this issue of personal property could be covered as well, perhaps with some laughter or tears, but hopefully, with a peaceful outcome.

It’s been our privilege to assist clients with family meetings, helping them cover the key elements of their estate plan as well as imparting their legacy wishes to their heirs.  Final planning wishes and instructions can also be reviewed. Our experience has been that, while protecting clients from estate tax liabilities is important, it’s more important that clients can rest assured that their assets will go:   

  • to whom they want
  • when they want and
  • how they want.

A good estate plan will address all of these.

If you haven’t reviewed your estate plan in the last 5 years, created a cohesive family wealth transition plan, or held a family meeting to discuss your intentions, maybe it’s time to start.  Make sure your “will” doesn’t become a “won’t.” 

If you would like to see a typical agenda for a what a family meeting might look like, click here

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