Leaving behind a lasting legacy and providing for surviving family members in the event of an individual’s death or disability takes time, patience and consideration of a broad range of non- financial issues. While there are times when an unequal division of property among heirs is preferable, consideration should be given not only to how surviving family members will respond after the benefactor’s passing, but also whether or not the uneven distribution of assets should be addressed while the benefactor is still alive.
For example, consider a father of two children who spent the majority of his life building a successful and profitable business. If the son entered the family business while the daughter built a career with another company in another field, would both children consider it to be “fair” if the father left the business to his son? Would the daughter feel slighted? Would it be reasonable to the children if the father compensated the daughter with cash instead of ownership in the business?
How children will likely react to and manage an inheritance, especially when one child is bequeathed more control, more responsibility or more assets than the other, is open to debate. Moreover, when children consider an unequal division of a parent’s estate to be unfair, there is a risk that that heirs could challenge and fight over an estate plan in a court of law. Not only can this lead to fractured family relationships, but it may also result in a distribution of assets that is contrary to the benefactor’s well-thought-out wishes and plans.
To help ensure that family members’ estate plans are understood and accepted may require difficult conversations during one’s lifetime. There should be no reason for heirs to misconstrue an “unequal” division of property with one that is unfair or that reflects a lack of thought or love. By engaging in discussions and explaining the rationale behind a plan before a benefactor’s death, family members may avoid emotional reactions and be more understanding and accepting of a decedent’s wishes.
The professionals with Provenance Wealth Advisors have extensive experience working with high-net-worth individuals to develop sound estate plans and help them to communicate those plans thoughtfully and strategically to family members.
About the Author: Lee F. Hediger is a co-founding director with Provenance Wealth Advisors, an Independent Registered Investment Advisor affiliated with Berkowitz Pollack Brant Advisors + CPAs, and a registered representative with Raymond James Financial Services. For more information, call (954) 712-8888 or email firstname.lastname@example.org.
Provenance Wealth Advisors, 515 E. Las Olas Blvd., Ft. Lauderdale, FL 33301 (954) 712-8888. Lee F. Hediger is a registered representative of and offers securities through Raymond James Financial Services, Inc., Member FINRA/SIPC.
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