Estate planning experts are helping older adults realize unspoken hopes about the “right” distribution of assets to grown children. Sometimes this results in less equal, but ultimately more fair plans. Realistic and transparent family communication is key to successful estate planning.
When Simplest Is Not Best
When families have assets to be distributed to the next generation, it is often assumed that the simplest solution is the best, resulting in dividing assets evenly among offspring. However, though sometimes unspoken, many older adults are rightfully more concerned about the futures of some children than others. Disabilities, career paths, health issues, locations, education and caregiving are examples of dynamics that are important to factor into plans about the distribution of assets to adult children.
Although it can be daunting to make a decision to give more to one child, than others, open communication can pave the way to plans that end up making sense to everyone. Recently, this example was shared in The New York Times:
To head off sibling strife, parents should explain their decision to each child individually or as a group, or even seek mediation, said Arline Kardasis, co-founder of Elder Decisions in Norwood, Mass., which helps families reach decisions on inheritance, caregiving and other aging-related issues.
Ms. Kardasis mediated one case in which the father asked two successful sons how they would feel if he left a larger inheritance to a third son, who had financial and health issues.
The two sons decided they would rather see their struggling brother receive more than possibly have him seek their financial help later. “Both brothers wanted to have a good relationship with their brother and did not want to be responsible for him,” Ms. Kardasis said.
Good To Know: What is an Estate Bond?
An estate bond is a type of fiduciary bond: it guarantees the beneficiaries that the estate will be administered in accordance with the law. Although often waived by families during the process of creating the will and naming an executor to administer it, estate bonds can help inspire the confidence of everyone involved. Sometimes bonds are required by probate court and can be referred to as executor, probate or personal representative bonds.
It is quick and easy to obtain any of these bonds from leading, national provider: Colonial Surety Company. Just get a quote online, fill out the information, and enter a payment method. Print or e-file the bond right from anywhere. With Colonial’s direct, digital bonds, it’s that simple. Learn More and Get an Estate Bond Here.
Our aging population means that with increasing frequency, adult children will find themselves taking on caregiving roles for their parents. This may lead toward increases in fair and unequal bequests. For example, a 2018 survey by Merrill Lynch Wealth Management found that two-thirds of Americans 55 and older said a child who provided them care should get a bigger inheritance than children who did not.
When making your estate plan, don’t forget to arm your family with information about your own care preferences as you get older. A trust might turn out to be helpful. Whatever you decide, remember, advance preparation—and honest communication—is truly a gift.
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Founded in 1930, Colonial Surety Company is a direct writer of surety bonds and insurance products. Colonial is rated “A Excellent” by A.M. Best Company, U.S. Treasury listed, and licensed for business everywhere in the USA.