Tis the season of giving and gifting, but should everyone on your list receive the same gift? You weigh different factors, and think about their needs, but what is the right choice?
If you have more than one child, you should be asking yourself the same questions as you build your estate plan. Should you leave each of your children the same amount in your will or trust?
Just like shopping on Black Friday, leaving all your children the same amount can feel like the best approach at first, but there are some instances where it might not be the wisest strategy, or even the fairest.
Factors you might want to consider include:
- One child earns considerably more than your other children
- One child has several children of his or her own, while another child does not
- One of your children serves as your caregiver, runs errands or helps you in other ways much more frequently than your other children
Sadly, you may have to ask yourself another, more troubling question: Has one of my children disappointed me so often, or behaved so irresponsibly in the past, that I feel like I must disinherit him or her entirely?
In cases where one of your children suffers from drug dependency or severe mental illness, inheriting money may actually do more harm than good.
We understand that this is a tough decision, made all the more difficult by the fact that unequal inheritances can lead to hard feelings and even challenges to your will or trust. If you believe that the best approach is to treat your children differently with regard to inheritances, here are some ways to avoid potential problems:
Take the time to talk to your children about your will (or trust) and its contents. While this can be a hard conversation, explaining your decisions to your children will help them understand why you have made them in the first place. Such a conversation can go a long way toward lessening any shock and the potential for disputes that might occur if your children first learn about the contents of your will or trust after you are gone.
Consider compensating your children who are “there for you” when you need help around the house or running errands while you are still alive. Similarly, if a child is going through a difficult time, such as the loss of a job or a divorce, consider offering financial assistance now instead of later.
You can add various clauses to your will in order to reduce the potential for litigation. For example, you could stipulate that any disputes after you pass away must be mediated rather than litigated. Or a no-contest clause can stipulate that a beneficiary forfeits his or her interests if the will is challenged.
Perhaps most important of all, make sure that you take the necessary steps when you create your will to show you are of “sound mind.” Such steps can include getting an evaluation from a doctor, as well as a psychiatrist, shortly before your documents are signed. If you are making changes to your existing will or trust, this precaution is even more important.
If you are struggling with the idea of unequal inheritances for your children, we can assist you with making these difficult decisions and help ensure that your wishes will be carried out.
Contact a New York Estate Planning Attorney
Please contact us today to schedule a time to discuss your estate planning needs.