When planning to pass on your estate, you may feel like all will be fine as long as everyone gets a piece of the pie. If only it were that easy! If you are considering splitting up your estate in unequal parts, be aware that your heirs may feel snubbed if they are on the lesser side of the inheritance.
How do you split your estate unevenly and still keep the peace in the family or, at the very least, keep it out of the courts?
The uneven distribution of an estate is always a challenge. Nevertheless, when it must happen, it must happen carefully. Why might you split assets differently among your children and what are the challenges? Private Wealth investigated this matter recently in an article titled “Playing Favorites.”
While “favoritism” may seem the sole motivation, such is generally the exception to the rule. Commonly, after a “lifetime” of rearing their children, parents may want to level the playing field out of a sense of fairness. Whether making adjustments for unrepaid lifetime “loans,” helping children who were less “successful” financially than their siblings, or protecting an inheritance from a squandering prodigal, the reasons for unequal inheritances are as unique as the families themselves.
Since there are so many variations on the unequal inheritance theme, the key is to ensure that your reasons are thought-through, valid, and clearly communicated. Remember: inheritance and disinheritance are complicated subjects, both legally and emotionally. Depending upon your reasons, you may want to explore other options when comes to conveying your legacy to your loved ones.
Reference: Private Wealth (January 7, 2014) “Playing Favorites”