When it comes to estate planning, many Michigan families think the best concept to keep in mind is fairness. However, it should be noted that being fair doesn’t necessarily mean that assets should be split equally.
While this concept might seem uncomfortable or untoward on its face, it can make sense — depending on the asset that is to be passed along. For example, if one child is interested in inheriting and running the family business while another is not, attempting to be “fair” and giving them each 50 percent interest might not please either of them.
By the same token, the fate of major assets ought not to be decided without the input of the people who will be receiving them. While not receiving an expected inheritance can be a crushing blow, receiving something that will take up too much time, effort and taxes can be just as detrimental.
Of course, every family should treat estate planning as a work in progress. Someone’s assets — and heirs — will be different at age 45 from what they are at age 65 or age 85. An outdated will can produce a lot of consternation.
In terms of making sure an family business is well cared for, it is essential not to wait until the founder of the business — who may be the matriarch or patriarch of the family — to die before figuring out a succession plan. A leadership vacuum can often lead to chaos and family infighting.
Source: Wealth Management, “Avoid Family Conflicts During Estate Planning,” E. Patricia Chantler and Wonsun Willey, May 15, 2013