Every family is unique. Parents need to let their loved ones know what they wish them to do in the event something happens. Unfortunately, many children are too busy, not local or are reluctant to face the realities of their parent's mortality. Other times parents choose not to inform their children until it is too late. Whatever the reason, your personal instructions to family can make for a smoother transition and avoid family arguments upon death.
Personal instructions to your family can include many things. They are not legal documents, but they are notarized letters of instruction about how you would like your loved ones to handle things after you are gone. While they are under no legal obligation to follow these guidelines, the fact that you took the time to put them in writing, have them notarized and include them as part of your overall estate planning efforts... most loved ones will do their best to follow your wishes.
Five Factors To Consider:
1. Burial Instructions: It is always a good idea to share your wishes about which funeral home you want to use, whether you want a wake, cremation versus burial, a funeral breakfast or just a memorial mass. If you have already provided this information verbally to your loved ones, that's great. But to have it written down and letting your family know where the written instructions can be found is even better. This will make it easier for them to administer your wishes, especially during this emotional and traumatic time.
2. Your Favorites: Over the years, many people find a favorite church, pastor (priest or rabbi), bible passages and songs that they would like to have for their final services. If you do not write them down, your loved ones may not be familiar with your preferences and struggle to make arrangements. Your efforts here will allow them to spend more time helping the family and less time worrying about the details.
3. Personal Property Dispositions: Here is where many families end up with trouble. Fighting over a parent's personal possessions has ruined more families over the years than any other estate matter. Who will get Mom's jewelry, the big screen TV, Dad's coin collection or the fine china? Unfortunately, if you do not spell out a fair and equitable system for the distribution of these items, some of your children, possibly influenced by their spouses ("the outlaws"), may feel that they are entitled to them. Others may be resentful and this is where family arguments start.Here is a simple system that anyone can use to avoid this problem.
First: Make a list of any specific items that you would like to go to one child or another. Place a fair value on those items. If your child chooses to accept the item, the fair value is deducted from their share of the estate. Put this list in writing and have it notarized by a disinterested third-party.
Next: Have your family arrange to meet on a weekend and on the first day, inventory the remaining personal property items. With this inventory, have them all agree on a fair value for each item. On the following day, have each of your children, starting with the oldest to youngest select one item at a time that they would like. The next round should go from the youngest to oldest and have them continue this until there is nothing left that anyone cares to claim.
Finally: Hold an estate sale for whatever is left or donate the remaining items to a local charity. They should add any proceeds to the estate figures or provide each child with a donation receipt for income tax purposes. If everyone agrees and participates, no one should have any reason to feel slighted or left out and they may even have some fun as they share memories from years gone by. It will bring them closer together.
4. Personal Desires and Wishes: While children have their own views on most topics, it is always important to remember your roots. By sharing your beliefs, desires and wishes for how you would like your children to carry on after you are gone, it might be nice refresher for them to remember you by. Use this letter to share any final wisdom or advice and try to finish by letting them know that you will always love them. You might be surprised that they will listen more after you are gone than they ever did while you were alive.
5. Personal Notes To Children: Many parents find it hard to express their feelings about certain issues to their children while they are alive. By providing a short personal note to each of your children, grandchildren or other loved ones, it may be easier to write your feelings and clear the air after you are gone. In many cases, these short letters could help your loved ones put their own lives into perspective. Always try to leave them with a caring, positive and lasting memory.
Summary: As with all important financial and estate planning documents, you need to review and keep them current. Your efforts in this section may be the most important to your family and the place where you can provide the most assistance. Spend a little time now to save a lot of problems later or share this with your own parents and encourage them to do the same.
To discover additional financial, estate and income tax strategies, check out my blog or download your FREE Wealth Expansion Kit by clicking here. The first step to creating wealth is knowing where you are and then charting a path that will enhance your financial strengths and correct your weaknesses.
Keith is also the author of "How To Get Your College Education For Less". Available on Amazon.com - ISBN No: 978-1-4538-2053-7. You can get your FREE Wealth Expansion Kit, or check out his blog by visiting http://www.sftaweb.com.