In Estate Planning, Fair and Equal are Different

Estate Planning
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We all have witnessed how children have a difficult time understanding why one sibling was treated differently. To overcome this, parents will make the well-intentioned mistake that fair and equal are the same.

What may work fine when you are raising children does not always work in estate planning, as reported in The Press Enterprise’s article “Why ‘fair’ and ‘equal’ aren’t always the same.” Thinking that treating children in the exact same way will avoid children arguing about who got more, who deserved more, etc., does not apply here. Trying to treat kids the same, often ends up with parents feeling guilty and questioning their parenting skills. Sibling rivalry does not always end when your children become adults.

Adult children can have an emotionally charged and surprisingly juvenile response when their parent’s estate plan comes to light, before or after a death. Beneficiaries often equate their parents will or trust provisions with how much they were loved—or how unfairly they were treated.

When the older sibling who “was always Mom’s favorite” is put in charge of the estate, other siblings may hear “Mom did not love me as much” instead of recognizing that their older sibling has always been better at being organized and working through problems, or may have professional skills or talents that make them better able to handle the role.

One of the hardest decisions in estate planning is often who should be in charge of managing the estate. In fact, this often leads to the entire estate plan grinding to a halt. Some parents elect to name several adult children as co-fiduciaries. Sometimes this works, and other times it turns into a complete disaster.

If you do not want your children doing battle with each other in court and want them to continue functioning as a family, it is best to have conversations in advance about your wishes. If you want them to work together, take into account the family relationships and dynamics.

Sometimes the best plan may be to choose a family member or friend to manage the estate, so as to avoid choosing one child over another. If the trusted person is a legal professional with trust administration experience, that may avoid years of family strife. However, if that family friend or relative also has their favorites, or if there is any animosity between the children and this person, it may become even more complicated or fractured.

If a parent’s sibling is selected, will that person be able to perform the duties of their role, or might they be too infirm?

Another option is to name a professional fiduciary, such as a trusted accountant. Some people consider using a corporate trustee, like a bank or a trust company, but the size of the estate often dictates whether or not the will serve in this capacity.

Your estate plan needs to have clear instructions. Talk with your estate planning attorney about your family dynamics. They may have recommendations that you have not considered. Talk with your children, so they understand your thinking. A little information in advance could go a long way towards preserving family unity and avoiding sowing the seeds of future disharmony.

Reference: The Press Enterprise (Sep. 14, 2019) “Why ‘fair’ and ‘equal’ aren’t always the same”

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