Most people think children should inherit equally. However, you may contemplate treating your children differently for various reasons.
AARP’s recent article, “How Should Your Children Inherit? 4 Scenarios Where ‘Equal’ Is Not Appropriate, gives us some situations where an equal inheritance might not be appropriate and the pros and cons of treating children differently.
Scenario #1: A Caretaker Child/Child Lives With the Parent. One child often primarily helps an elderly parent. This could include helping with medical appointments, coordinating care with various health care providers, being heavily involved in end-of-life care, paying bills and companion care. Such care is often provided by a child who lives with or is close to the parent.
Therefore, if a child lives with the parent, it may be appropriate to leave the home to that child to the exclusion of others. A parent may give the caregiver-child a larger portion of the inheritance in recognition of the additional help provided.
Scenario #2: A Special Needs Child. If a parent has been the primary caregiver for a special needs child, the estate plan should consider this to make certain that the child will be adequately taken care of after the parent’s death. With the potential of government aid, this can require a special needs trust or supplemental needs trust for the child. As a result, the trust will hold more or less than an equal share of the estate.
Scenario #3: A Child With Issues. If a child has issues, such as mental illness, substance abuse, divorce, or creditors, or is poor with money, you may not want to leave them an outright inheritance or any inheritance. The same is true for an estranged child. A trust will provide some (protective) support for such a child.
Scenario #4: Kids With Wealth Disparities. Sometimes a wealthy child may tell a parent to treat them differently and give more to other siblings, or a parent may feel that a wealthy child doesn’t need the inheritance. However, a person’s wealth can change over a lifetime, so this should be well thought out.
Being completely open and honest with your estate planning attorney about how this might be received in your family is essential. That way, the choices can be considered carefully.
To ensure you make informed choices and create an estate plan that aligns with your intentions, we encourage you to call our office today. Take the first step toward securing your family's future by reaching out to us now.