When creating an estate plan, most people focus on larger assets like real estate and bank accounts. However, it is important to give careful consideration to the handling of personal property as well. Even though these types of assets may have a lesser financial value, they often can be the source of disputes during the estate administration process. Addressing personal property in your estate plan can help avoid problems down the road.
7 Tips for Handling Personal Property When Creating an Estate Plan
The following are seven helpful tips for dealing with personal property as you create your estate plan:
- Discuss inheritance issues with your loved ones. If you’re comfortable with this type of conversation, giving your loved ones a chance to speak up about personal property issues can help prevent disputes down the road.
- Put together a list of all of your property that cannot be titled. Referring to this list can help ensure that you address all potential issues when creating your estate plan.
- Decide if you will give your personal representative or trustee discretion to divide your personal property fairly among your beneficiaries. If so, it is important to consider and carefully outline what “fair” really means. For example, fair could mean allowing each beneficiary to take a turn choosing an item of property. Or, it could mean letting the personal representative or trustee make the decision based on the value of the item and the beneficiary’s personal attachment to it.
- Consider asking your loved ones what items they would like to receive and why. If you agree with their requests, incorporate these distributions into your estate plan. If you disagree, you will have opened up an opportunity for discussion.
- Think about your overall estate planning goals and how your personal property factors in to this plan. For example, if your desire is to divide everything equally among your children, ensure that you are considering the value of individual items of personal property as you draft your will or trust.
- Consult with an attorney to consider all possible distribution and transfer methods that fit in with your estate planning goals.
- Consider addressing methods for resolving disputes over personal property. For example, you may instruct the personal representative or trustee to sell an asset that is under dispute and distribute the proceeds.
When you are ready to take the next steps for creating your estate plan, we are here to help. We encourage you to contact us today at 714-459-5481.