3 Reasons To Tell Your Kids What They Will Inherit
For many people, estate planning is both a private matter and a morbid topic – not something that parents want to discuss with their adult children. While having such conversations takes a lot of courage, families that speak freely about these delicate issues can avoid problems down the line. Here are 3 reasons to tell your kids what they will inherit:
1. Avoid surprises. Families that speak freely about estate planning can sometimes address awkward situations that might arise, like the choice of the executor – who is in charge of distributing assets after someone dies – or succession plans for a family business or the leaving of assets in trust. Tempting as it may be to tailor your plan to the personalities, abilities and needs of individual family members, remember that disparate treatment, particularly of children, can rekindle old rivalries or ignite new ones.
2. Refine your approach. While parents have no obligation to change an estate plan after hearing a child’s preferences, disclosing what they plan can lead to a better result. For example, maybe you are thinking of leaving one child a larger inheritance than the others because he has more children. By sharing these details with this child, you might learn that he would prefer to receive the same amount as his siblings, rather than face their wrath. When there is a family business, company founders often want to pass along the enterprise to the children who are involved with it. But it’s important to gauge whether they want to continue that role.
Another thing to discuss is whether your estate plan will even out certain disparities that have arisen during your life. For instance, if you lent money to one child for a business venture and were never repaid, you could leave that child proportionately less.
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