By Lane V. Erickson, Idaho Estate Planning Attorney
Estate plans are like fingerprints. No two are exactly alike. The reason for this is that every single person has a unique and different family situation, estate to deal with, and their own desires and wishes to fulfill. Because of this, the estate plan that you create should be able to handle your unique and individual circumstances rather than being a cookie-cutter form.
The basic documents that create an estate plan include a durable power of attorney which allows you to deal with your finances and property if you are unable to handle them yourself while you were alive. It also includes your power of attorney for health care so you have help in making medical decisions. Additionally, your estate plan includes your living will so you can make end-of-life decisions. Finally, you also need a last will and testament which gives you the ability to distribute your money, property, and other assets to your family members, loved ones, friends and/or charities after you die.
It’s important to understand that you are in complete control of your estate. In other words, you have the ability of distributing your estate to whoever you want in whatever amounts you want with only a few limitations. The purpose of this article is to talk about how you should distribute your estate, so it is fair to your kids.
For this article we are assuming that you have no surviving spouse. We are also assuming that you have at least two or more surviving children. In this circumstance, many of my clients ask me to help them figure out how to distribute their estate so that it will be “fair”.
What is “Fair”?Fairness is an interesting concept, especially when it comes to distributing an estate. The reason it is an interesting concept is because there are really two aspects to fairness. The first is objective fairness. The second however, is the difficult one, which is subjective fairness.
Objective fairness simply means that everybody gets exactly the same thing. In other words, if you have four children, they would each get exactly 25% of your estate. That is easy to say but sometimes difficult to do. This is where subjective fairness comes in.
For example, if you own four vehicles, objectively, each of the kids would get one vehicle and that would be fair. However, it’s likely that each of those vehicles has a different monetary value associated with them. Because of this, one child may get an expensive vehicle and another child may get a junker. Even though they each got a vehicle from the estate, it may not actually be a fair distribution.
Even if all four kids got the exact same type of car with the exact same value, they may still subjectively feel like it is not a fair distribution. There could be some sentimental value associated with the vehicles as well. Suppose you used one vehicle to go fishing with your kids. They all have fun memories of that vehicle and being with you because of the experiences they had with you. If only one of your children ended up with that vehicle, the other kids may feel like that’s not fair.
What Do Your Kids Think?Through the examples listed above, it’s easy to see that fairness is a difficult thing to achieve. For this reason, it’s often wise to talk with your children and find out what they think would be a fair distribution. By getting this information from your children you can identify any concerns they have, and also be able to see what they subjectively feel would be fair.
It’s many instances when this is done it’s easy for a parent to determine how to distribute their estate fairly. However, in other circumstances it makes the process of fairness even harder. If, for example, all your children want all the same things, it may be impossible to actually distribute those things to your kids in a fair way. Because of this, it may then be wisest to liquidate the estate, turn it to cash, and then make a distribution of money that would be equal and fair to your children.
What Do You Think?Through this entire process it’s really important that you always consider what it is you think is fair. You may have had one child help you more than your other children. If you own a farm or a business, you may have had one or more of your children be involved in the business with the others not being involved. One of your children may have given you a specific item of furniture, or a gun, or some other specific item that should likely go back to that child rather than going to other children.
Because of these and other circumstances that may exist, it’s wise for you to think for yourself about what is fair. We’ve found that through this process most parents are able to figure this out for themselves. However, if for some reason they’re not able to, there are other options that we can help with his well.
If you still have questions about how to distribute your estate fairly, we can help. Please contact us for a free 30-minute consultation where we can talk about your options and help you make some decisions that you will be comfortable with as part of your own estate plan.
Enlist An Idaho Estate Planning Attorney To Help YouOur team of Idaho lawyers can help you with any of your estate planning or probate needs. Whether you are seeking to create or review an estate plan for yourself or would like to help a loved one, we are available to discuss your options and answer your questions at an initial free 30-minute consultation. Call us toll free at 877-232-6101 or 208-232-6101 for a free consultation. You can also email us directly at lane@racineolson.com or stop by our office at 201 East Center Street, Pocatello, Idaho 83201. We will answer your questions and help you solve your Idaho Estate Planning problems.