Planning your children’s inheritance doesn’t have to be complicated. Whether you live in Texas or another state, if you keep a few tips in mind when you go to see your attorney or estate planner, you can ease both your mind and your children’s.
First, you don’t want your children to have big surprises at your death — especially if those surprises are not going to be good. Communicate with your children about your estate and plans while you are still alive. You don’t have to give them the “down and dirty” details, but by giving them a ballpark estimate of your estate’s worth and your plans, you have set their expectations and relieved them of anxiety or possible disappointment after your death.
If you have multiple children, likely you care about all of them. Therefore, if at all possible, don’t play favorites in your estate planning. This will only cause bitter feelings between siblings when you and your spouse are both gone. If you have reason to divide your estate unequally, the best time to explain those reasons is while you still can.
If you are afraid that your children, or one of your children, is not capable of handling the money you want to pass on to them, you can set up a trust to distribute the money in intervals, or when you feel it would be the best time. For instance, if one of your children has a drug addiction, or is still very young, you could have the money held until they are stable or of a certain age.
If you are not going to play favorites when dividing your estate, don’t trust one sibling, such as the oldest, to be in charge of equally distributing your estate among all siblings. This might be especially true if you have step-children you want to receive an equal share or if all siblings do not get along. You can add multiple beneficiaries on insurance policies and the percentage they are to receive. Include all of your children as beneficiaries with equal shares and you can eliminate potential family disputes.
Source: AARP, “How to Leave an Inheritance to Your Kids” Oct. 02, 2014