The Family Meeting: An Integral Part of the Estate Plan

November 1, 2014Estate Planning & Probate, News

By Robert J. Saalfeld

You have signed all your estate plan documents. They are even up to date. Congratulations, you have completed everything. Or have you?

Have you explained at least the basics of your estate plan to your family? Do they know what they may need to do if you become incapacitated or die? Do they know who you have named to administer your estate? Will they forever ponder or even misunderstand why you made certain decisions? Will that misunderstanding cause strife among your children when you are gone?

A family meeting can provide answers to these questions, reduce family squabbles, and make the process smoother. In the olden days of estate planning, parents typically didn’t tell their children anything about what was in the will. Rather, they just let it be a surprise after their death. Now days, many families are using the family meeting as a valuable part of the estate planning process. Consider the following tips to have a successful family meeting:

    1. Select an appropriate place. Probably not a restaurant, for instance.
    2. Have an agenda of topics and send it out beforehand. Most clients do not invite the in-laws to this meeting.
    3. Consider having your key advisors present so they can be introduced to your children.
    4. Although there may be some initial anxiety, encourage open communication and questions.
    5. Tell everyone who you have named as successor trustee and/or personal representative. Go over the duties of this person or corporate trustee, as the case may be. Inform the trustee/personal representative where you keep important documents.
    6. Tell everyone who you have named as your health care representative. This is the person who will make health care decisions if you are unable to do so. Discuss your wishes regarding issues like life support decisions.
    7. Tell the children you love them all equally. Some folks forget this part, but I think it is important. Your estate planning documents are important documents, but they don’t always convey information such as this.
    8. You don’t necessarily need to tell your children exactly how much to expect, but provide a general outline of how your assets will be divided.
    9. Be prepared to explain why you may have made any unequal distributions, such as the family business going to the child working in the business, or why one child’s share is to be managed for them in a trust. This can be a hard conversation to have, but it can reduce the chance of litigation later.
    10. Address how outstanding loans to children will be handled, such as being treated as an advance on the borrowing child’s inheritance.
    11. Discuss how any death tax will be paid. Discuss your suggestions as to which assets might be sold first. The family meeting may highlight a need to do further planning to reduce death tax.
    12. Discuss how ownership of any vacation home will be handled. Sometimes this goes to one child as part of their share, and sometimes it goes to multiple children and they co-own it, either as tenants in common or in an LLC. The views children express regarding the vacation home ownership may influence how you ultimately decide to deal with this asset.
    13. Discuss the mechanics of how tangible personal property will be distributed.
    14. Take the opportunity with all the children present to provide some moral guidance and reiterate what family values you hope the children will embrace as they continue with their lives after you have gone.
    15. Ultimately, you have to tell the children you love them all, it is your money, you have done what you should do, and you hope they accept it and get along.

You’ve spent time, energy, and money developing your estate plan. Having a family meeting can help ensure that your loved ones understand the key information so that your plan can be carried out successfully. If you are interested in discussing a family meeting, please call our estate planning group.