Is it possible to write a will that can prevent an estate battle? You won’t have any control over what happens once you die, but there are steps you can take to reduce the risk of an estate battle erupting.
Creating an estate plan is the first step you can take – leaving behind no will will often create confusion and animosity between your loved ones. A carefully considered estate plan is a gift to the people you leave behind.
But if you don’t receive specialist advice, well-meaning people do things destined to create discord, rancor and resentment among their heirs. What looks good on paper may play out disastrously in real life, says Accredited Specialist in wills and estates, Bryan Mitchell.
“You may think your loved ones will do the right thing,” Mitchell says. “Human nature is not always that way.”
You can reduce the chances of an estate battle though, in conjunction with a specialist in wills and estates.
NAME THE RIGHT EXECUTOR
A badly-behaved executor can be disastrous for the estate. An executor can steal from the estate, drag their heels or refuse to deal with the necessary paperwork or even respond to emails and calls.
People often name executors based on family hierarchy (the oldest child, the only male) or personal relationships (the spouse, the best friend), rather than considering the skills needed for the job. The person tasked with settling an estate should be responsible, organized and scrupulously ethical.
Executors of an estate have an obligation to engage in the due administration of the estate. Enormous obligations are cast upon an executor to gather in the estate, pay all testamentary debts and expenses and to distribute the estate in a correct and legal way. It’s important to remember that failure to administer the estate appropriately may result in the executor being personally liable for their oversights.
It’s worth considering appointing an objective third party as executor of your will, such as a lawyer who understands the complex nature of the law and can act fairly.
INCLUDE PERSONAL PROPERTY
Some of the littlest things — a childhood toy, a holiday decoration, a piece of costume jewelry — can trigger the biggest family fights. Anything with sentimental or emotional attachments can stir up old rivalries and lead to lifelong rifts.
If you have sentimental items. ask your loved ones what they want and make decisions now about who gets what. Make a list, update it as needed and keep it with your wills or other estate documents. If you avoid this discussion because you’re afraid of conflict, imagine the battles to come when you’re no longer around to mediate.
CONSIDER ALL ASPECTS OF ESTATE PLANNING
People can, and should, make sure their surviving spouses are adequately provided for. It’s also unwise to dump a large amount of money on someone too young to handle it, but estate provisions that tie money up for decades may also be a mistake.
For example, people with larger estates often create trusts that allow the children to inherit only after the surviving spouse dies. But if Dad’s new wife is closer to the kids’ age than his own, that could be a long, resentment-filled wait.
Another common estate provision is to dole inheritance out over several years, for example with a chunk at 21 and another at 25, with the balance paid out at 30. But some people use such provisions to drag the distribution out over decades or try to restrict what middle-age children do with the money.
If you have legitimate concerns about how your heirs will handle their inheritance, a testamentary discretionary trust offers you the best flexibility. You can tailor the terms of a testamentary trust to suit your particular circumstances. For example, you can restrict access to the assets in a testamentary trust in appropriate circumstances, such as where a major beneficiary has an addiction or is unable to manage a significant inheritance. Testamentary trusts can also provide that a beneficiary has a right to live in a house while preserving the assets for the ultimate beneficiaries (effectively a life interest).
EXPLAIN ANY UNEQUAL BEQUESTS
Parents usually think they have good reasons for leaving one child more than others. Perhaps one child is not as financially successful, or was more attentive in the parents’ final years. But unequal bequests often feel unfair to those left behind, and can be the catalyst for an estate battle.
Parents who aren’t planning to make equal distributions should schedule a family meeting and explain their thinking to their kids.Those discussions may not be comfortable, but hearing the explanations directly from the parents can help keep the kids from blaming one another later.
Ultimately though, it’s unwise to completely cut family members our of your will. In each of the states of Australia, the law casts an obligation upon a will maker to make adequate provision for certain persons. The definition of ‘certain persons’ differs from state to state. In Queensland, a will maker ought to make adequate provision for the following persons:
· Former spouse (in limited circumstances);
· A dependent (in limited circumstances).
To receive specialist advice about your wills, estate planning or an estate battle, please contact our experienced team today. We offer a FREE, 10-minute phone consultation.