As a financial advisor to families for over 30 years, one of the most difficult conversations I had with clients was convincing them to discuss their estate plans with their children. They would often tell me. “The kids will work it out after we are gone” This was a recipe for disaster, setting the children up for messy battles that could tear a family apart.
One of my clients worked for his father in his waste management company starting when he was in high school. His older and younger brother also worked with him to support his dad’s business. When Dad passed away, he stipulated in his will that the oldest brother would inherit the business expecting my client and his younger brother to go to work for him.
Unfortunately it didn’t work out that way. My client felt like he had been cheated out of his future. He never spoke to his older brother again and started his own waste management business which became very successful.
It certainly seems easier to let our executors share with our family our intentions after we are gone. But it is a grave mistake. It is our responsibility to share with our children what our intentions and desires are before we die.
This is especially true if we own vacation real estate. One of my clients has a beautiful cottage on a lake in New Hampshire. His children and grandchildren have been going there since they were born. I asked him what his plans were for the cottage after he was gone. He replied, “ I don’t know. I will let the kids decide that”
I asked him what he thought would happen if two of his three children wanted to keep the cottage but the third couldn’t afford to support it. How would they decide what to do with his share? I informed him that this type of situation would do nothing but create friction within the family that could have horrendous ramifications. He needed to meet with his children and develop a strategy that they all could live with.
Fortunately he agreed with me and had a family meeting that was very successful, making it very clear to the family how the cottage would be handled and avoiding any future conflict.