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Your Will - should you leave equal amounts to your children?

Dec 1, 2019

Which would you prefer? To be remembered for what you achieved or what you owned? Let me hazard a guess - the first one. Either way - you're responsible for the outcome - for disposing of the assets you’ve managed to gather during your life. Wouldn’t be a shame if people were to remember you for how you’ distributed those assets - perhaps because that distribution was deemed unfair or controversial?

Which would you prefer? To be remembered for what you achieved or what you owned? Let me hazard a guess - it’s the first one. Nonetheless - you’re still responsible for disposing of the assets you’ve managed to gather during your life. Wouldn’t be a shame if people were to remember you for how you’ distributed those assets - perhaps because that distribution was deemed unfair or controversial?

How you construct your Will can be particularly fraught if you have more than one child - especially if your offspring’s circumstances are dramatically different or you’re much closer to one than another. The simplest solution might be to divide whatever you have equally among them. But is equal necessarily the same thing as fair?

An increasing number of parents are answering that question with a resounding, “No.”

An uneven split can be the right way to go

According to a study in America by Merrill Lynch Bank of America/Age Wave, parents with more than one child are more open than ever before to leaving different sums to each child. Two-thirds of Americans believe that, under certain circumstances, an uneven split is the right way to go.

Among Americans who have a will, the percentage planning to leave unequal inheritances to their children more than doubled from 16% in 1995 to 35% in 2010.

But, of course, however, sensible these uneven proportions might be, they can lead to ugly sibling fights, jealousy and meltdowns.

The key to reducing the chance of conflict lies in managing expectations. Then you’re less likely to have one sibling blaming another.” Or you.

Slicing up the pie

The standard advice among experts always used to be - divide your estate equally between your children. In the long run, it’s always the fairest approach.

But there are many reasons why you might consider another option. Think about these scenarios -

  • What if one of your children has their own children and the other doesn’t? Or, one has significantly more children than another?
  • Suppose one of your children becomes your or your spouse's primary carer? In so doing, they might have given up a significant amount of their income. Don’t they deserve a bigger slice of the pie?
  • And how about step-children? ‘Blended families’ can be especially problematic. Should step-children or adopted children benefit to the same degree as your own ‘biological’ children? Conflict often arises between spouses who have children outside the current marriage, where each feels strongly about whose children deserve what.
  • You may feel that a child with a greater financial need is more deserving. Let’s say one is a banker and the other a nurse.
  • Perhaps one of your children is tied into the family business. Should this be a factor?
  • Then you have the scenario where one of your children has special needs and will need expensive care after you’ve gone.

These represent just a handful of situations where you might feel that equal distribution of your assets would be neither sensible nor fair. In this article, we’re not taking sides or making recommendations - simply pointing out how careful consideration needs to be given before finally deciding on  

A different kind of inequality

You may wish the financial value of your inheritance to be divided equally among your children but the way it’s handed out to differ.

With one child you may want to give them the money outright. With the other, you may want to put the money into a trust - either for a period of time or for their entire life. That’s not equal, and your children will know it’s not equal.

Typically, this stems from the parents’ desire to protect the child, not to punish them. If a child battles with addiction or overspending, a trust ensures that the child has access to the money. The trustees have a say in how and when it’s handed over.

You may also be concerned that a child’s marriage may be rocky, or feel uneasy about your son- or daughter-in-law.

One solution

Regardless of how you decide to split your assets, usually the best action you can take is to sit down with your children and tell them what you’re doing and why. This will help to avoid misunderstandings and misperceptions.

One approach, if you’re planning to put the inheritance of one child into a trust, you could avoid hurt feelings by using a trust for the other children too.

Sometimes it’s best to keep quiet

Disclosing your plans isn’t always the best idea. Sadly, we have to accept that children can sometimes be greedy and manipulative. If you tell them your plans in advance, they might harass you - putting all kinds of pressure on you to change your mind. In this scenario, I’m afraid, there will probably be conflict whatever you choose to do.

However, tricky your personal situation might be, don’t make the mistake of forgoing making a Will. This is more likely to cause the most expense and upset of all your options.

Whether or not you want to leave your children money, a major family squabble is not what you’ll wish to be remembered for.

Ask the expert - always

Of course, your best option is to consult an expert - a specialist who can advise you how to give yourself the best chance of distributing your estate and possessions fairly and equitably. For exactly that kind of specialist advice …

Contact Tim Mullock on 01234 713021.
Or email Tim.Mullock@AdeptAssetSolutions.co.uk

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