What, and when, to tell the children?
This can turn out to be one of the most difficult, according to an article on the website for Lifecare Innovations, a 21-year-old firm that helps people navigate the health care, government and guardianship systems.
“There’s no single right answer for everybody; what to do depends on the nature of your planning and your family circumstances,” the article by Robert Ross, an attorney based in Inverness, Ill., with 30 years of experience, states. “But it’s worth giving the issue some consideration. Many people are very hesitant to reveal the details of their family’s expected inheritances. A recent survey by UBS of almost 3,000 investors showed that only 54 percent had discussed their estate plans with their heirs, and only 34 percent had mentioned specific dollar figures.
“Many parents say they fear that if their children find out they can expect a substantial legacy in the future, they’ll be less likely to work hard and save in the present. Another worry is that revealing an estate plan could lead to family squabbling and resentment. This is especially true if you plan to leave unequal inheritances to family members.”
Ross goes on, however, to argue more in favor of bringing the children more fully into the picture than keeping them in the dark.
“But while it can be difficult, there are also some very good reasons for having a detailed talk with your family about your estate plan,” he wrote. “For one thing, if there’s a chance of family squabbling and bitterness, it can be better to tell everyone what to expect now, while you’re still alive and have a chance to explain your motives and smooth things over. You could explain, for instance, why you’re leaving more assets to a child with a large family than to a child who is single, or why you’re leaving money to a charity that has always been important to you.
“In fact, the UBS survey showed that heirs who weren’t told in advance about inheritance arrangements were more than twice as likely to be unhappy about them afterward.”