There’s nothing quite like death to bring out the living. Some families gather to tell stories, share hugs and maybe fight over Grandma’s pie plate. Others turn the reading of a will into a full-contact sport.
Estate planning, done right, is an act of love and organization. Done wrong, it’s a gift that keeps on giving … to attorneys. Let’s explore some of the quirkier corners of estate planning, where human nature meets legal fine print.
I recall a crusty elderly client with four children. He was a no-nonsense guy who peppered his language with salty words. But he was reduced to tears explaining how one of his children needed extra financial support. He was gut-wrenched over being “fair” with how his wealth was distributed.
Parents often swear they love their children equally, but equal love doesn’t always mean equal money. One child might have special needs, another might be struggling financially, and the third is a neurosurgeon married to a hedge fund manager. If you’re going to tilt the scales, at least communicate your reasons while you’re still here. Otherwise, the resentment can live longer than you do.
Money divides families, but “stuff” can destroy them. When it comes to heirlooms, people stop being rational and start being relatives. I recall my Great Aunt Louise, who would use family reunions as an opportunity to visit a relative’s house and tag items she wanted to inherit. You could find her name on a small piece of tape under a vase previously owned by Granny King, or behind an old family portrait. You can’t make this stuff up!
You can avoid this by making a “personal property memo,” a simple list of who gets what and why. Be specific. Write it down. Update it when necessary. And please, don’t make your kids draw straws for the Gatlinburg cabin.
One of the biggest estate planning blunders? Failing to update beneficiary designations or ownership titles. You’d be amazed how often a retirement account or life insurance policy still lists “ex-spouse” as the beneficiary decades after the divorce.
Remember: beneficiary forms typically override your will. So even the best estate plan can be undone by an outdated form buried in a file cabinet. Review them every few years, or after major life changes like marriage, divorce, birth or winning the Powerball.
