Discussing estate planning with the family

New York residents may be interested in ensuring that their assets are transferred to heirs as they intended. Having the frequently avoided inheritance conversation may be one of the best ways for securing heirs’ understanding of how property is to be divided. UBS estimates that $40 trillion in personal wealth will be passed to heirs by the year 2050.

The discussion about inheritance can be emotional, but putting it off for too long can be expensive. Both parents and children may not be comfortable discussing death too openly. Parents may also not want to discuss wealth to be handed down for fear that it will be demotivating to the younger generation. However, facing the reality of the inevitable can help parents prepare their heirs for the tax consequences and other responsibilities that may be tied to the wealth.

If the parent’s resources are not distributed equally with all children, it may cause disruption in the family. If one or more of the children has been taking care of the parents, they may feel that they are entitled to more of the assets. For example, if the family jewelry is passed down to only the daughters, the sons may feel that they have been slighted. Parents discussing their reasoning for how they determined the allocation of assets may help avoid hard feelings and misunderstandings among family members.

In order to facilitate the discussion and help draft an estate plan, a benefactor might work with an attorney. An attorney might be able to help a client create a plan that provides for the heirs and beneficiaries while still distributing the wealth according to the benefactor’s wishes.

Source:  NASDAQ, ” Expensive Consequences of Not Having the Dreaded Inheritance Conversation “, Motley Fool, August 23, 2014