If you have finished your estate plan, Congratulations! You and your estate planning attorney created a plan that is suited for your family, you have checked on beneficiary designations, signed all of the necessary documents and named an executor to carry out your directions when you pass. According to Beck & Lenox Estate Planning & Elder Law, an important question to answer is, how much should we tell the children about our estate plan? A recent article entitled “What to tell your adult kids when planning your estate” from CNBC explores this often tricky decision.
There are certain parts of estate plans that should be shared with adult children, even if money is not among them. Family conflict is common in many cases, whether the estate is worth $50,000 or $50 million. So, even if your estate plan is perfect, it might hold a number of surprises for your children if you have not discussed it with them before you die.
The best estate plan can bequeath resentment and enduring family conflicts, if family members do not have a head’s up about what you have planned and why.
If you die without a will, there can be even more problems for the family. With no will—called dying “intestate”—it is up to the courts in your state to decide who inherits what. This is a public process so your life’s work is on display for all to see. If your heirs have a history of fighting, especially over who deserves what, dying without a will can make a bad family situation worse.
Not everything about an estate plan has to do with distribution of possessions. Much of an estate plan is concerned with protecting you, while you are alive.
For starters, your estate planning attorney can help you with a Power of Attorney. You will name a person who will handle your finances, if you become unable to do so because of illness or injury. A Healthcare Power of Attorney is used to empower a trusted person to make medical decisions for you, if you are incapacitated. Some estate planning attorneys recommend having a Living Will, also called an Advance Healthcare Directive, to convey end-of-life wishes such as whether or not you want to be kept alive through artificial means.
These documents do not require that you name a family member. A friend or colleague you trust and know to be responsible can carry out your wishes and can be named to any of these positions. For more information on basic estate planning decisions, click here: https://beckelderlaw.com/estate-planning/ .
All of these matters should be discussed with your children. Even if you don’t want them to know about the assets in your estate, they should be told who will be responsible for making decisions on your finances and health care.
Consider if you want your children to learn about your finances during your lifetime, when you are able to discuss your choices with them, or if they will learn about them after you have passed, possibly from a stranger or from reading court documents. Many of these decisions depend upon your family’s dynamics. Do your children work well together, or are there deep-seated hostilities that will lead to endless battles? You know your own children best so this is a decision only you can make.
It is also important to take into consideration that an unexpected large inheritance can create emotional turbulence for many people. If heirs have never handled any sizable finances before, or if they have a marriage on shaky ground, an unexpected inheritance could create very real problems—and a divorce could put their inheritance at risk.
How much should we tell the children about our estate plan? The attorneys at Beck & Lenox would encourage you to talk with your children, if at all possible. Erring on the side of over-communicating might be a better mistake than leaving them in the dark. We can help you review what would be important to communicate, based upon your particular family dynamics. We help clients with this every day.
Reference: CNBC (Nov. 11, 2020) “What to tell your adult kids when planning your estate”