Whether or not you watched Succession (how could you not?), it’s not hard to imagine how dealing with family money can be dysfunctional at best, and downright embittered at worst. Estate planning is a necessary process to help cope with loss—but even still, the decisions involved in estate planning are a recipe for tension and miscommunication among loved ones.
I spoke with Mitch Mitchell, associate counsel at Trust & Will, to understand all the ways things can go sideways if these matters aren’t discussed while the parents are still alive. Here’s what to know about discussing family money with your siblings before it’s too late.
Have clear communication about who will be the executor
Mitchell explains it’s common for one sibling to be the executor—aka the one appointed to carry out whatever the will says—while the other siblings must go along with those wishes. This means that the parent must make a decision as to who is in charge, which demands some advanced discussion while the parent is still alive. This is not just so the executor is prepared to step into that role, but so the other siblings are prepared for their roles, too.
After spending a decade in estate planning and probate work, Mitchell shares that a lot of bad blood comes from debate about who is in charge, why they’re the one in charge, and whether or not the one in charge is being forthcoming with all the information they have.
So, how do you avoid bad blood? Mitchell says it comes from having clear, proactive communication as early as you can. Let’s take a look at how that kind of conversation should take placce.
How to talk about your estate planning
Mitchell lays out a scenario where a mother names the middle child, not the eldest, as executor of their estate. This could because that kid physically lives the closest to the parent, or the mom feels they’re the most responsible kid, and so on. It doesn’t matter what her reasoning is—what matters is that it’s her estate and her decision.
Mitchell’s tip for parents hosting this discussion is to come prepared with not just the decision, but the reasoning that went into their decision-making. Even if it’s not the same choice every individual family member would make, parents can soften the blow by having an open discussion that gives everyone time to process. And even if your family shies away from “money talk,” now is the time to tackle that taboo. To overcome your discomfort, Mitchel describes embracing a new mindset where this is your family saying, “Hey, I love you, and here’s what I want you to do with my legacy.”
The main goal is to make sure all the decisions are already made and firmly understood before the estate owner has passed. Mitchell’s number one piece of advice: “Nothing should be a surprise.” This way, when the siblings are forced to deal with the administrative side of things, there’s no in-fighting. It’s just the nitty-gritty of accessing accounts and following what the will says. And here’s a glimpse of what that nitty-gritty involves:
Documents: Where are your parents’ important financial documents? Are they final? Who can access them?Health: What are your parents’ desires for long-term care? Who will make end-of-life decisions? Is there money set aside for their end-of-life care and funeral expenses?Personal property: How will it be divided? Who gets the house? How will jointly-held assets be managed?Responsibilities: Who will help settle the estate? Will one sibling take on more responsibility than another?Inheritance: How will any inherited funds be distributed? Are the funds held at a bank or brokerage?Debts: Do your parents carry significant debt? Will the debt be transferred to one or multiple siblings?
The bottom line
Early communication is key to avoiding lengthy and irrelevant fights down the line. “Hurt feelings are inevitable when someone is disappointed,” he says, “but it doesn’t have to turn into a full-blown dispute in a probate court.”
And most importantly: What did Mitchell and other estate lawyers think about Succession? Apparently, it was “perfectly emblematic” of all the family problems you encounter when a major patriarchal presence dies. The “it’s not fair” mentality among siblings doesn’t go away with age. You can make a tough conversation a little easier by opening it up now, before it’s too late.
For more tips on all kinds of estate planning topics, check out Trust & Will’s resources here.
>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : LifeHacker – https://lifehacker.com/talk-to-your-kids-about-your-estate-plan-now-and-how-t-1850586552
