So, you’re writing your Will, but you’re not sure if you want to equally distribute your assets among your children. There are plenty of reasons why people decide not to do an equal split. There might be estranged relationships at play or irresponsible spenders in the family. Alternatively, you might have children who live with a disability or a chronic illness or medical condition, and need to be set up for the future.
Sometimes, parents have different kinds of relationships and levels of involvement with their children, so it’s not that strange for people to wonder if their assets should be divided equally among dependents, or if, for example, a child needs to be included at all (it happens).
Luckily, we’ve put together this guide for you to help you on your Will-writing journey.
So, do I have to share my assets equally among children?
When writing your Will, you technically have a moral obligation to multiple parties following your eventual death. This obligation ensures the ongoing safety and well-being of your dependants, who might include a spouse or de facto partner, children (even if they are adults with children of their own), and any other dependents.
Generally, it’s best to include all children from current and previous relationships in your Will and to divide assets equally among them. If you think this isn’t the best way forward and you leave a party/parties out, then these excluded parties may contest or challenge the Will in the future. But you kind of want to avoid this. After all, you might not be getting a front seat to all the future family ~DRAMA~, but your loved ones will… and don’t even get us started on the additional legal costs that your estate will be coughing up in the case of a familial dispute. Yikes.
Just something to think about… but if you’re still adamant about not dividing your assets equally among your children, scroll on.
Excluding a child or children from your Will
There are times when it makes sense to exclude a child or give them less of an inheritance, like if you have an estranged relationship. If a dispute arises, it will be up to the Court to determine if this party has actually been unfairly excluded from your Will. The Court will consider a range of things, like if the child has attempted to reconcile throughout the years, and the reasons for the lack of contact (so yeah, they’ll do a bit of a deep dive into your history).
If you are still adamant about excluding a child from your Will, you can’t just omit their name and leave it at that. Why? The Court might think that you have accidentally forgotten them, and will automatically reallocate your Estate with them in it. So, in this instance, it’s recommended that you prepare a letter to your Executor, detailing why you have left one or more of your children out. (Again, if a claim is made against the Will, the decision is ultimately up to the Court).
Scenarios where parents choose to assign unequal amounts
There are myriad reasons why people stray from a traditional equal division of assets among children. Some examples include:
- If an adult child has been a caregiver in recent years/for many years, you may want to compensate them for lost time or wages.
- If one child has received more money than others over their lifetime. For example, you may have paid for some or all of their wedding expenses, helped with a house deposit, or bought them a car, but have not financially helped out the others.
- If you have a child who cannot care for themselves, you may choose to leave them more than the others to help with basic living expenses and ongoing medical costs. (Siblings are likely to understand this, but it’s a smart idea to let all your children know about these plans in advance).
Tips to avoid challenges in your Will
- If you have a child who is unable to responsibly manage an inheritance on their own, use a trust to provide structure for them.
- Exclude all children from the Will-making process. This will invalidate claims of undue influence.
- Discuss your Will with all your children, so no one is surprised when the time comes.
- Ensure you clearly explain your reasoning, always.
This is a tough time for your family, which is why leaving an equal inheritance for all can help avoid the emotional turbulence that this situation brings.
While equal inheritance is the easiest option, there are nuances in every family, so it might not be the right option for you. Ultimately, it’s your money, so it’s your choice where it ends up. But if you’re going to divvy up different amounts for each child, or exclude a child from receiving an inheritance, then you will need to explain your reasoning clearly. This way, if a party contests the Will, you have a reasonable backup that will help the Court honour your wishes.
Here at Willed, we’ll help make this difficult time a little easier and a whole lot more affordable than the big guys. We’ll simplify the process for you, and save you time, money and a whole lotta stress. Start today at willed.com.au.
Side note: Dished out some loans to your family over the years? You can keep track of any familial loans in your Willed Vault. Your vault is complimentary when you make your Will online with Willed.
Disclaimer: The content of this blog is intended to provide a general guide to the subject matter. This blog should not be relied upon as legal, financial, accounting or tax advice.