Are you planning to design your estate plan to make sure your adult kids are treated fairly? What if one child has never been good with money, while the others are completely independent? This post from New Jersey 101.5, "Being fair in estate planning," says there are options.
While there's no easy answer to the question of what is fair, treating the children equally can be fair. But so can unequal treatment.
Let's look at how a parent treats a minor or young adult child. There are times when a parent simply needs to spend more on one child. The reason may be apparent—for instance, if one child has a disability or serious illness. But it can be more muddied when one child participated in costlier school-age activities, went to a more expensive college, or planned a more expensive wedding than the other kids. Even so, provided each child was given equal opportunities, the unequal financial support may not be a problem. Nonetheless, some parents believe that it's important to keep everything as equal as possible.
Continued parental support can be tougher when a child becomes an adult. Consider why an adult child is having financial problems. Is it because of poor work habits, a gambling or drug addiction, a divorce, or a disability? There are lots of situations with a multitude of factors, and each needs to be reviewed and handled differently based on that specific family's dynamic.
Most parents feel their children should inherit equally, but this assumes each child has similar needs and circumstances, has received similar support in the past from mom and dad, and has proven to be a responsible and capable adult. If this isn't the case, an unequal inheritance may be fair.
Providing additional financial support to one adult child over another via the parent's will should be within a parent's discretion. If so, parents need to let each child know their plans. This will help avoid surprises or hard feeling at the time of the parent's passing. Hopefully, the other adult children will not feel slighted if they understand the rationale.
Problems can still arise, even with parents' best intentions. Talk with your estate planning attorney about potential issues. It's important to note that if you die without a will, state law will dictate how your assets will pass.
Should you decide to make an unequal split among the kids, make sure to state your wishes in a professionally drafted and legally valid will or trust with the assistance of a qualified estate planning attorney. He or she can help you minimize any bad feelings between siblings and avoid potential fights down the road.
Sadly much of what passes for estate planning today is little more than word processing. Someone asks a few questions and then fits you into their pre-defined box. This isn’t planning – This is simply document preparation. Don’t settle for word processing in place of quality planning!
At Idaho Estate Planning we will take time to get to know you, your family, your desires, your concerns, your goals, and any potential future problems. Your estate plan should be a custom fit not a “one size fits all”. Remember, good planning is no accident.