10 Questions to Help you Choose your Heirs

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Passare.com shutterstock 512943880 10 Questions to Help you Choose your Heirs Heirs Family Estate planning Elizabeth P. Anderson Beekman Wealth Advisory


When it comes to planning your estate, one of the most difficult parts can be distributing assets to your heirs. We found a story in Forbes that discusses how to approach what can be an emotional process.
Because every family is different, there is no correct answer on how to distribute your estate, but choosing your heirs often requires a “series of trade-offs to avoid emotion-laden family problems,” writes Forbes’ Elizabeth P. Anderson who is the CFA and founder of Beekman Wealth Advisory. “Gray areas often come into play because emotional factors usually drive (these) decisions.”

Anderson believes if you can answer the following questions, it will help you frame your thinking:

  1. . How much of your estate do you want to give to charity? How much do you want to give your family?
  2. . What form will your estate take? Will it include cash, securities or other assets?
  3. . Would you like to distribute your assets outright or in a Trust?
  4. . If you use a Trust, what are the provisions? How long will your Trust last and who is the Trustee?
  5. . Do you want to distribute your assets during your lifetime?
  6. . Do you want to divide your assets equally among your heirs or use some other basis like for need or good behavior?
  7. . Can your heirs handle the responsibility of managing their own finances? Will they need help?
  8. . Will moving assets out of your estate during your lifetime reduce your ultimate estate and gift tax bill?
  9. . How will you handle gifts of tangible assets like art, jewelry or furniture? Are there items of particular sentimental value to particular heirs?
  10. . When would you like to communicate your plans to your heirs? What kinds of communications will best support your family?

Unfortunately, for some heirs, knowing they will receive a future inheritance may actually serve as a disincentive for them to provide for themselves. Anderson suggests you bring your most responsible heirs into the process early on.

“Remember, your assets are yours so you are free to dispose of them as you see fit,” writes Anderson. “You can control what (and how) you give but you can’t control the reactions of the recipients, how they treat the assets or how they treat each other. All you can do is to try to lay the groundwork for healthy family relationships.”

“Making decisions about the disposition of your assets can be an emotionally fraught and time-consuming process,” Anderson writes. “If you take (these) small steps and then seek expert guidance, you can realize your plans for the financial care of your family.”

Read the story here.


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