Estate Planning: What about Your Personal Property?
When planning estates, most tend to focus on the big tickets items such as the house and investments. These items are important but it’s also important to include estate personal property that will be passed on to your heirs. Often distributing possessions like furniture, jewelry, photographs and other personal items can be the most contentious among family members.
Robin Williams’ estate is an example of how personal belongings can cause fighting amongst the heirs. Even though he had his estate planning documents in place, it appears that Robin hadn’t made arrangements for distributing his personal property. It was these personal belongings that caused the legal dispute between his children and widow.
It’s important to devise a plan and discuss it while one is still alive instead of leaving it up to your heirs. This tends to alleviate tension when it comes time to distribute your personal property.
Personal Property Distribution
There are a variety of options for distributing personal property. Whatever method is chosen, it should be transparent so that everyone knows what the rules are and that everyone gets a voice.
Here are some methods that have been used:
- Use colored stickers for each person to indicate what he/she wants. Where there’s only one sticker on an item, it will go to that person. Where there’s more than one sticker, then the family may revert back to taking turns on the contested items.
- Ask the family members to itemize 10 items they want with sentimental value and 10 things with a monetary value. Share everyone’s list. If two people want the same item, let them negotiate.
- Select according to birth order, either going from oldest to youngest or vice versa.
- Draw numbers and take turns picking items.
- Bid on items using “money” such as Monopoly bills. Everyone starts off with an equal amount.
While many personal belongings are unique, in the case of photographs and videos, copies can be made.
If there is only one or two valuable possessions, your will could direct for the items to be sold and proceeds divided amongst the heirs. Or if one member really wants a particular item, the heir could buy it from the estate for the fair market value or reduce their inheritance by that amount.
Communicating Property Distribution Wishes
Once a plan is created, it’s important to communicate the plan to your heirs. Sometimes they may not be happy with your decision but at least they’ll know your wishes and understand your motives for distributing your personal property. The plan should be written down, signed and dated.
Managing Family Property Disputes
Where there are conflicts among family members over particular items, estate attorneys often act as mediators, but a trained mediator can be used. Mediation can help the family members get at the root of the interests with the process; healing past wounds and disagreements rather than intensifying them.
This process can be specified in your estate planning documents with a clause stating that if the kids are unable to agree after 30 or 60 days, then Ms. X is the final arbitrator.
Good feelings amongst family members are more valuable than any of your personal possessions. A thoughtful distribution plan can help keep the family harmony that most parents want.
Estate planning is one part of the comprehensive planning a family can do to protect loved ones and assure the family can continue on after you pass on. At Blankinship & Foster, we help you consider all the important decisions that affect you and your family’s finances. Sound planning take extra time and consideration, but is well worth the effort. Contact us to discuss how we can help you.