Estate planning is a process that involves a variety of considerations. Some people will emphasize some aspects more than others, and there are various approaches. One thing that needs to be understood about this process, though, is that a plan that looks good may not mean that the plan will actually work out well.
When a plan goes badly, one will often see lawsuits and turmoil among the family. This can slow down the probate process and make everything needlessly expensive. That is why it is important to be proactive in preventing family disputes in estate planning, regardless of what one's other estate planning goals are.
One indicator that family strife may be ahead is when there is poor family communication. For parents, poor communication often means they do not discuss their personal finances and wills with children, opting instead to let the children sort things out later rather than deal with potentially sensitive issues right now.
It is important to discuss the major issues regarding a family estate plan with children, especially the reasons things are structured the way they are. Unequal distributions to children especially need to be discussed with children. When parents are able to articulate their reasons for unequal distributions, feelings about the decision sometimes soften. At the very least, it isn't a surprise later on when legal action is possible.
In our next post, we'll continue with this topic, and discuss the issues of disinheritance, diminished capacity and compensating a child-caretaker.
Source: The Birmingham News, "Children suing siblings over estate money," October 16, 2012