If you’ve watched The Grand Budapest Hotel, you’ll know how dramatic it can be when siblings or other family members don’t receive the payouts they’re expecting after a family member dies. But aside from what we see in movies and tv shows, family disputes are fairly common and can get pretty messy. If you’re wondering how to divide your estate fairly among your children, here’s a good place to start.
Even if it’s not a 50/50 split, it can still be fair.
Generally, Will-makers leave their estate to their spouse, and then to their children equally. The laws are complex, but typically, Will-makers can leave their assets to whomever they choose. In some cases, Will-makers choose to split their assets in a way where one sibling might receive a larger share of the estate than the other/s. When this happens, it’s usually recommended that reasons be outlined in the Will. For example, one sibling might struggle with health issues, and their inability to work may have led or could lead to financial implications. The parent would likely want to ensure that this child is set up for the future. Or, it might be a simple case where a parent has bonded with a particular child or stepchild. Whatever the case, if another sibling was to dispute this, ultimately what is reasonable will be determined by the courts.
All that aside – here are three steps that might help you get started with the estate division process.
Step 1. Identify your assets
Real estate – your home, any secondary residences or plots of land. If you own it, then you’ll need to include it in your Will.
- Any business interests
- Intellectual property
Step 2. Draw up a list of your financial assets
- Life insurance policies
- Retirement accounts
- Investment accounts
- Money owed to you. If someone owes you money, then they will owe your estate.
Step 3. Set expectations in advance
Family disputes are not all that uncommon, so if you’re thinking about steering away from a even split, it might even be worth sitting down with your children to explain why you have made certain decisions.
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.