When deciding what should happen to their belongings after they’re gone, most people choose to leave a significant portion to their children. As well-meaning as this can be, poorly worded estate planning documents can often lead to confusion, disputes, and even contentious legal challenges. Below are a few elements to consider when deciding how your assets should be divided among your children.
Including instructions such as “leaving each of my children an equal share of my assets” may seem like an equitable approach, but it can present serious, intractable problems later on. One factor many parents forget is that assets like real estate, vehicles, and artwork can’t simply be divided like a savings account or investment portfolio.
These vague instructions can leave your children in difficult, sometimes unpredictable situations. For instance, your son may not have the resources to buy out your daughter’s interest in the family home, forcing them to sell an asset one of them wanted to keep. Being as specific as possible in your estate planning documents can help avoid these unfortunate outcomes.
Decide Between Equal & Equitable Shares
Leaving each of your children an equal share of your estate can reduce the risk of conflict and simplify the estate planning process. This is a common, fair approach, especially if all of your children are in similar financial situations and have received equal benefits throughout their lives.
However, an equal division may not seem right if one child is struggling financially, has significant burdens, or has made sacrifices to serve as your caregiver. Or you may have already given one child significantly more resources than the others during your life. Adjusting the shares each child receives to reflect these facts may seem more fair. However, it’s important to discuss your decisions with your children beforehand and consult with an experienced estate planning attorney.
If you want to ensure your estate planning documents are in good order, work with the legal team at the Law Offices of Neil T. Nakamura & Associates. For over 43 years, they’ve helped Oahu families navigate the process, preserve assets, and protect loved ones. Visit their website for an overview of their services. To schedule a consultation in Honolulu, call (808) 945-7645.