Family dynamics can make estate planning complicated, even if you don’t think that you have a lot of assets to distribute. However, there are steps that you can take to ensure that your Maryland home, a bank account or other possessions can be allocated without causing conflicts between family members. These steps may include creating a trust or simply giving assets away to charities instead of your children.
Advantages of a trust
Creating a trust may help to minimize the risk of family infighting because its terms are not a matter of public record. Therefore, your children, grandchildren or other beneficiaries won’t know the terms of your estate plan unless you tell them. Furthermore, a trust can be tailored to ensure that money or other assets are distributed according to need or other relevant criteria. As a trust takes effect immediately, it can also protect your assets against being taken or depleted by competing family members while incapacitated.
Bypass your kids altogether
There is no rule that says you must give anything to your children upon your death. Therefore, you may want to consider an estate planning strategy that sees you gift your assets to a charity instead of passing them to your kids. This way, no one can complain that you showed favoritism or otherwise shortchanged one child in favor of another.
Another potential strategy to create better family relationships is to explain your estate planning choices while you’re still alive. For instance, you could justify the fact that you’re giving your youngest more money by pointing to recent economic trends. It’s likely that a younger child will need more money to buy a house or get an education in the future.
As you get older, your life will evolve in both predictable and unpredictable ways. Therefore, it’s important to consider estate planning as something that you actively participate in as opposed to a passive activity. Ideally, you’ll review your estate plan at least once per year and after major life events like a birth or a divorce.