Where There’s a Will, There Can Be a War: How to Prevent a Battle If You Decide to Split Your Estate Unevenly
It’s a common scene in the movies: a wealthy relative has died and the family has gathered for the reading of the will. All the characters are there, from the bereaved widow to the bitter ex-wife to the estranged son to the indifferent daughter to the hopeful nephew. Who will become rich and who will walk away empty-handed?
While that might be the stuff of Hollywood, something a little bit similar (if a lot less dramatic) plays out in law offices almost every day. A parent has passed away and the family is about to learn something that – if not handled carefully – can divide family members for years, sometimes forever. They’re about to discover that mom or dad, instead of splitting their estate evenly, has favored one beneficiary over the others. This uneven distribution of an estate has to be dealt with proactively if you hope to keep your loved ones on speaking terms after you shake off this mortal coil.
Just how do you accomplish that? Let’s take a look at this recent article from NextAvenue for some thoughts on a touchy subject. Freelance reporter Gary Stern prepared this article.
Uneven Distribution Leaves Brother “Devastated”
Stern begins his NextAvenue article with the story of brothers Robert and Lon of Queens, New York. They were very close, as siblings go, but when their mother passed away and chose to leave the bulk of her estate to older brother Robert, Lon was “devastated.” This sense of devastation turned to a bitter feeling of betrayal, to the point where Lon ultimately moved away from New York City just to put some distance between himself and his brother.
“Wills and estates have a way of disrupting families,” Stern writes. “But what can a parent do to avoid such enmity boiling over between surviving siblings? Experts say that making plans and discussing them openly can assuage hurt feelings when parents opt to distribute their estate unevenly among their children.”
One Viewpoint: Avoid the Uneven Split Entirely
“If sibling inheritance is uneven, it always leads to poor feelings [that] one sibling is better off than the other,” New York attorney Lorenzo Angelino told NextAvenue. His view is clear: “It’s generally not a good idea to split an estate unevenly.”
Melissa Langa agrees. A partner at a Boston-based trust and estates law firm and the co-author of a book on the subject (” The Complete Book of Wills, Estates and Trusts“), Langa feels that uneven splits can create the sense that “Mom always liked you best,” to quote comedian Tommy Smothers. This feeling can fester, and wounds of this nature can last for decades. As Langa says, “A child always wants to be treated equally.”
Bequeathing Control of a Business Often Favors One Sibling
Passing along control of a family business provides a particularly challenging example of well-intended inequality. Stern writes, “Wills have a way of frustrating that desire for equality among siblings. If the oldest child works in the family business and receives full control of it in the will, siblings who inherit only, say, nonvoting stock, are likely to feel slighted, even if they’d never set foot in the business.”
Is there a way to avoid this? Langa says yes. She suggests a positive solution: “The parents could name the siblings as beneficiaries of a life insurance policy that would pay each of them an amount equal to the value of the stock passed on to the oldest child. In this way, all of the children would be satisfied and feel that their parents treated them fairly.”
Favoring the Caregiving Child
For many families, the distribution of the estate is affected by who was (or wasn’t) there to care for an aging loved one. “Often,” Stern explains, “if one child lives close to the parents and actively cares for them in their later years, the parents leave that child the bulk of the estate. In such cases, it’s important for parents to explain their reasoning to their children who live far away and weren’t actively involved with their care.”
Langa suggests that organizing a family meeting, either in person or virtually, can be a helpful opportunity for parents to explain their decisions on the will well in advance. This can really alleviate the sense of bad feelings. (Our partners at Life Point Law can gladly facilitate just such a family conference on “neutral ground.”)
Sometimes an outside party is the best option when family dynamics are tricky. Sterns writes that “an estate lawyer may be the best choice to orchestrate the meeting because an attorney can serve as a neutral force to explain the inner workings of the will.”
But Langa warns that, even with professional help, you can’t always assuage hurt feelings. “If everyone’s been fighting for twenty years, they’ll likely fight for the next twenty years,” she says. Old habits of family acrimony die hard, especially over issues of money and fairness.
You May Need the Help of a Professional Mediator
If you want to get ahead of potential hurt feelings, Langa suggests looking at the inheritance from the viewpoint of every family member. But in cases where dynamics are especially contentious no matter what, Sterns encourages hiring a trained family mediator, and suggests The Academy of Professional Family Mediators as a resource for finding one.
There are some legal structures that have been put in place to prevent conflict, but not every state has them. Stern explains, “Some states, but not all, discourage fights over dividing up estates by allowing wills and trusts to contain a no-contest clause. It forbids beneficiaries to receive any inheritance if they challenge the will after the benefactor dies. If, for example, one child receives 70 percent of an estate and another gets 30 percent, the second child could lose even that smaller share by contesting the will.”
In our experience, such clauses need to be employed with caution, if at all. The bequest may stand, but the bitterness will linger. Nevertheless, courts in Washington State where AgingOptions is located have generally upheld no-contest clauses when properly done.
Uneven Can Still Be Fair
Stern points out that if one child is struggling with issues like unemployment or mental health challenges while the other sibling earns six-figures a year, it’s not exactly unfair for the parents to leave a larger share of the estate to the child with more pressing financial needs. “The parents leave more to a struggling child to make sure they have a roof over their head, and the other child may be relieved so that the sister or brother doesn’t end up on their doorstep,” Langa told NextAvenue.
Another option is to leave money to grandchildren, bypassing the adult children entirely. This way, “the grandchildren operate as an intermediary and take the onus off of how much money each child received,” Stern writes. Still, in our experience this strategy does little to prevent jealousy and bad feelings.
It’s also worth remembering that the estate lawyer should make sure he or she is clear with their client about the impact of their decisions. “I try to understand [the significance of] their wealth and give them options to dispose of their wealth to meet their goals,” Langa says. Along the way, she adds, “we will discuss the effects of unequal distribution on sibling disharmony.”
Try Talking It Out
It may be a cliché, but it’s true: communication is key, and it’s especially vital while the parents are still living and able to explain the reasoning behind their decisions. “You can minimize the surprise and hurt feelings by talking in detail in advance,” Langa says. That emphasis on detail is important, she adds, because “You never know what people are going to fight over.”
For his article, Stern spoke to Kurt Sommer, president-elect of the American College of Trust and Estate Counsel of Santa Fe, New Mexico, who said it’s best if the will is not a surprise to the children. “The best way to deal with this situation is to create an open dialogue,” he explains. “Establish communication between the parent and children and explain the disparate nature of the inheritance.” If relationships are strained, expect higher likelihood of conflict. “If you don’t have a dialogue so people can feel comfortable with the outcome, then you have a problem,” Sommer says.
A More Effective Approach: Transparency
This openness about estate planning is a marked change from the way it was even a few decades ago, when inheritances were considered a taboo topic of discussion, even among family members. But this transparency is ultimately a healthier way, as it alleviates the shock and sorrow that can come from surprises and inequality.
New York-based lawyer Herb Nass says that the bottom line should always be how much the parents love each of their children equally, even if the inheritance is unequal financially. He suggests going beyond money, including personal items in the will for each child that have special individual significance. “It’s important,” he adds, “to include an expression in the will how [the parent] loves each child equally.”
Spotting Trouble in Advance
Ultimately, a good estate lawyer should be able to catch places in the will where ill feelings might grow and advise their client about them. “In this way, attorneys make certain clients are comfortable with their decisions and aware of what potential conflicts might arise,” Stern writes.
Nass suggests that attorneys and clients deal with these things as objectively as possible, not emotionally. A side letter explaining the circumstances of the will, especially if it’s unequal, can be a great help to siblings after a parent passes, for example, especially if there was no family meeting beforehand.
But ultimately, Nass continues to stress that a will should always communicate that “the parents love each child equally and the amounts left in the will could be due to different economic considerations.”
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(originally reported at www.nextavenue,org)