Thoughts on making a will: Question to the Brain Trust

[Groesbeck Hurricane]

Looking for ideas, creative is good as well, on the making of a will.

There is a need to make a will to divide up worldly goods.

There is a small farm with a large home, two classic cars, some equipment, some savings, some life insurance, some furnishings and such.

In the family are three children:

Oldest makes a substantial income, significantly more than anyone else combined, never has any money, always begging for money, could not afford $800 to repair their vehicle's transmission. Has zero interest in farm but wants the money. Unstable relationship. Zero planning for the future, no savings.

Middle child makes a sufficient income, has supplied time and money to farm, cares about farm, stable relationship. Saving for future.

Youngest child just graduated from university with zero debt. Has supplied time and money to farm and cares about farm. Young, just starting out and planning on marriage. Has put a small amount of money away while a student!


Ideas that have been thrown around from friends, family, attorneys:


Donate farm to charity and force sale on all goods and divide money three ways.

Force sale of farm and all goods and divide money three ways.

Put everything in a trust and give equal shares to all children.

Put farm in trust for youngest two children, divide remaining equally amongst all three.

Allow two youngest children to divide up farm and divide remaining equally amongst all three.

Put farm in trust for two youngest children, provide enough money to off-set value of farm to third child, divide remainder evenly amongst all three.

Provide a set sum for oldest child and let remaining two children divide everything amongst themselves.


I am sure there are thoughts, opinions, and better ideas. Now is your chance!

[Groesbeck Hurricane]

I forgot... Should the farm be given a stated value in the will or allow value of farm to be estimated market value at time of death?

[id10t]

Set amount to oldest, put into a retirement fund or similar so he does have something later in life. Farm into a llc, trust or whatever w/ youngest two owning it half and half.

Any of them passionate about the cars (aside from financially)? If so, there's the answer for the cars. If they are gonna fight over 'em, then either make your wishes clearly known to them now, or specify that they are sold and the money split.

[widgeon13]

Farm would only be valued at time of sale in order to maximize generated revenue. Most likely there would be capital gains due after the sale and before distribution. Funds could be directed to a trust to be distributed in any number of ways.

[H.G.P.]

Put farm in trust for two youngest children, provide enough money to off-set value of farm to third child, divide remainder evenly amongst all three.

I'd also like to see sufficient funds added for the youngest two to offset any and all future tax liabilities for a set period. (Otherwise they may have no choice but to sell.)

Also, designations of special gifts, timing of dispersions, and who should have/be DPA. Some, perhaps many, can be dispersed before time in attempt to diffuse any arguments.

[Schumi]

Where is the option for "rack up a ton of debt going out with a bang, then force sale of everything to cover debt and leave whatever measly amount is left for them to split"?

[aigel]

I would split it 3 ways. The kids still can change. Your stable one may go non-linear and the irresponsible one may see the light.

Another way to do it - but that's later in life when they are all done having kids - is go by the number of grandchildren they produced who certainly will appreciate some wealth coming down to them stemming from you. Ultimately that's all that will be left from you in 60 years (I am assuming you are 40+).

I would force the sale of everything and set up trust funds that pay out over time. I am no expert, but if one of them (or two of them who can agree) wanted the farm, they can go buy it from the estate. Same for the classic cars. If all that's left is $ that's split evenly, there is little to fight about. They only will be pissed at you for forcing the sale, which is better than being pissed at each other.

I have seen some ugly stuff when it is time to inherit. Everyone thinks the other siblings got the better deal, no matter if it was the case or not.

That's all I can add - certainly no lawyer advice but what I'd do in your shoes in terms of splitting it up and liquidating the assets.

George

[sc_rufctr]

Originally Posted by Groesbeck Hurricane

... Put everything in a trust and give equal shares to all children...

IMO That's your best option. It's fair and your children will appreciate it.

Once you're gone they will then have to decide what to do with your assets. Their problem after you're gone... Don't make it yours now.

I know you know this but I'll say it anyway... Regardless of what you do or say there is no way you can control what happens after you're gone.
If they squander it then they wouldn't be the first to do so.

I'm sure you've raised them the best you could so the rest is up to them.

Meanwhile... Look after yourself and live a long life.

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I've seen some extraordinary things happen after people have gone and their children begin to squabble over the remaining assets.

Like... Siblings entering an ageing parents home before their departure and placing coloured stickers on pieces of furniture claiming ownership.
Red for Bob, Green for Suzie and so on...

Also... Just after someone has died I witnessed a family arguing about who gets the apartment in the city that belonged to the deceased.
The deceased person was laying in bed in the same room they were having the argument in.

[Groesbeck Hurricane]

Hmmm, seems we need more information:

Oldest is in 40's

Middle is in late 30's

Youngest is 21

Parents in 60's

Does this change opinion?



Do you include grandchildren if only one of the children was able to have children? Does it matter if one has little or no contact or influence on the grandchildren?

This is an interesting line of thought.




Oh, I have no living children. When I go what is left will go to some of my close friend's children, unless Wife survives me (though she questions sometimes whether I will live out the day ;-).

I've seen some horrible things in my life. I had a family member demand money from us when my father died. Of course, they received nothing. I've seen wealth most of us would dream of having be squandered in a very few short years because the departed hoped their child would change once they received it.

We have been trying to get my mother to spend her money on herself before she goes. Don't know she ever will as she is approaching 90 and shows little chance of changing her ways. Oh, and she has gone through and marked stuff. I'm not mentioning the sticker thing to her, don't want to encourage her in thinking of going just yet. She's still a bit too young ;-)

[sc_rufctr]

No... Nothing changes. Split it three ways.

That's what I've done. I have two daughters, 21 and 22 this year and one son who turned 15 in March. (no wife)

[lukeh]

I would give the younger two the farm and the older one more cash to offset the the fact he didn't get the farm. Why give a farm to someone who doesn't want it and why sell the farm out on the two that would want to keep it? This soluton seems to keep the peace and make everyone happy.

This is what my in-laws did. They had quite a bit of land that is used for hunting and tree farming. The two boys are always up there hunting and working the land. The four girls could care less as they don't hunt and have no interest in tree farming. The boys were left the land and the girls were left the house and more cash so everyone came out even.

In my mind it would have been insane to just split everything 6 ways or to force the sale of the land. The girls would have been put in the awkward positon of wanting to sell the land but feeling forced to negotiate with their brothers. Then what is one of the girls decides not to sell but has no intenton of contributing to the tree farming business. Why open that can of worms when you can just leave everyone exactly what they want and avoid any potential issues?

[MRM]

You are right to be careful. If you don't handle this very delicately, it will cause problems with the family that will last three generations. My family also had a farm that we grew up on that needed to be divided between four kids after my father died and my mother didn't want it any more. Several years later, I still don't have contact with much of my family and barely talk to my mother. If things go as I plan, my grandchildren will never set foot on the farm I grew up on. Money was the least of our issues. With careful planning, you can avoid the same problems.

There are two things to consider. The most obvious issue is the monetary value of your estate. That's the easiest to take care of. You just leave each kid an equal share of the estate. There are many devices for leaving equal shares, from making them sell everything to leaving it in a trust with three equal shares, to anything else you can come up with. The real issue is the emotional attachment the kids have to the farm.

Trust me when I tell you that the money will not be the issue. The issue is two-fold: 1) The emotional attachment to the farm that can't be compensated by money; and 2) The respect each kids wants to feel that he has been dealt with fairly.

There is only one farm and three kids. Two kids love the farm and have sunk their blood and sweat into it. Both would love to someday own the farm, raise their kids on it, and pass it down to their children. The third doesn't care about the farm but knows that because the other two care about it so much that it is the most valuable piece on the board. He'll use their emotional attachment to the farm to negotiate a higher cash value in return for walking away from the farm. So you have to worry about two kids who would love to own Dad's farm and one who will manipulate the other two to his advantage over the farm.

My advice is to treat each kid equally. Regardless of your feelings for them and their success in life, their inheritance should not be dependent on who you think is more deserving or needs the help, or will benefit from it the most. And whatever you do, don't give it to one kid because he'll take care of it better than the other two. While that might be true and the others might agree, there is no way you can suggest that one will be the better caretaker without insulting the other two. If you want to send the farm to one kid or the other, do so in a way that allows the others something of equal value without suggesting they are somehow less worthy. It's just very hurtful for a kid to hear that his parent finds him unworthy or the other sibling is his parents' favorite.

In treating the kids equally, you have to account for the fact that even if the three kids get equal value, but only one gets the farm, the one with the farm has received more than the others, because they care about the farm more than money. So you have to somehow handicap the farm by giving the others something of similar emotional attachment, like the cars.

I do think that it is fair to recognize the work put into improving the farm while you own it.

I think you should start a conversation with all three boys about who wants the farm, who is likely to be able to afford to take it on, and how the rest should be compensated for not getting it. You might be surprised that they are able to work something out between them.

And finally, remember that circumstances change. The younger one might strike it rich in ten years and be able to retire to the farm comfortably. The middle one might take a job across the country and be happy that the younger one gets it. The older one might get religion and decide to move back to the farm and reconnect with his roots. Whatever you come up with, make it flexible enough to work in the future.

[Dottore]

Originally Posted by Groesbeck Hurricane

I've seen some horrible things in my life. I had a family member demand money from us when my father died. Of course, they received nothing. I've seen wealth most of us would dream of having be squandered in a very few short years because the departed hoped their child would change once they received it.

No kidding. I know of a son who killed his father in his sleep. Why? The father told him the night before he was going to disinherit him because of his drinking problem–so the son killed him before the old man could change his will.

Whatever you do, divide things equally. If you don't, the resentments you create will last for generations.

[Por_sha911]

Many years ago, my parents called the children and said "what would you like to have?". They made some decisions on some things they wanted each of us to have (jewelry for instance) and stated that whatever wasn't designated was to be sold and split among the siblings (after the last parent died). They also made provision for a small inheritance to go to the children of my sister who had already passed away. All other grandchildren will get the inheritance from us (trickle down economics I guess).
I think it was so wise for them to give each of us a chance to think about it and say if we had something that was important to us. They gave us a few months to reply before they set up the will. None of us chose items of great value but mostly everyday things that had a sentimental memory attached it.

[Groesbeck Hurricane]

Originally Posted by MRM

You are right to be careful. If you don't handle this very delicately, it will cause problems with the family that will last three generations.

Thank you! I am so sorry for your pain!

This is why the family I am talking with asked me to go out and get some opinions. They do not wish to cause harsh feelings that could/would divide the family.



Other thoughts are very welcome.


(They did not provide me with the option to spend it all and let the debtors sort it out Sounds good to me!!!!!)

[jpachard]

As an aside to the family questions, make sure you do this in such a way as to avoid/minimize the tax implications for the inheritors. My Dad has to keep rewriting his will every few years because of the crazy laws in the state he lives in so that everything is current and so that the state won't end up with a big chunk of the inheritance.

Good luck.

Cheers, James

[tabs]

Now comjes TABS..some might say I pontificate...thats because I do speak for GAWD...thats thone who spells his name AWD and not OD...I do want to make that distinction because the one with OD in his name mght get mad at me, and that is something I KNOW I do not want to happen.

Anyway to be serious. What ever you do make sure it is an even split. Also if you want to leave them anything specific as in an item, make sure they all know and voice their opinion about it before hand.


The one thing I would not want to happen is for ill feelings to come between them over what I leave behind. . No matter how it is decided there will be some, but one could say those feelings come out of the family dynamic and really have nothing to do with material things.


You could also choose to blow it all, stick the kids with the Old Folks Home bill and die oweing a bundle. Or U could adopt me and save all the bickering that is going to take place after ya croak, I could blow it all as well as they will and I have lots of experience doing it to boot.


BTW I plan on taking it all with me....

[Steve Viegas]

I am not sure I am helping here but:
1. You could ask the kids what they think.
2. Someone will not be happy when all is said and done (likely the one that you have the poorest relationship with, but it could be anyone or all).
3. You will need an executor of your estate, I assume it will be one of the children. There is generally some reward attached to that role.
4. While you will not be around to witness the mayhem that ensues, you will sleep better from now until the distribution if you do what you can to alleviate any stress brought by this. Starting now is a great move.

I wish I had an answer for you. I fear all parents end up in a similar boat (I have two children myself). Best of luck.

[Seahawk]

No family dynamic occasions more turmoil than inheritance, even in modest estates...like many here, I have seen the worst.

If the siblings are so inclined, there will never be "equal shares": someone will feel slighted, the Will will miss a terribly important emotional attachment never before revealed by a child...the less successful of the children will bemoan the equal shares, citing need the others do not have.

There is no right way if the family is so inclined.

My Father and I have had this discussion since I am the Executor of his Will. He is a bit worried of a repeat from the odd days after my Mother passed away when, as he put's it, the "Tomb Raiders" showed up.

Your friends are young, BTW, and are still a couple...they need to make sure that the first wicket, Estate Planning, takes care of their shared assets should one pass before the other and second, the death of them both.

They need to make sure that each of them is protected should the other pass first. This is key. Make sure there are no dangling legal, ethical or other modifiers (insurance) that affect each other.

In our Will, the surviving spouse gets everything, which I recommend. I will say our lives are not complicated by ex'es and children from other marriages, etc., plus both our names are on everything.

The next level is up to them.

[ErVikingo]

One idea, sell everything and put money in trust. Set up trust to add a fixed % of the salary each of them makes. Thus, if one slacks off his share of the bounty is reduced.

Specify that, if there is $ left when one of them dies, the balance is split between the remaining ones. Set up a provision that any $ left over in case all pass away is distributed to other family or charities.