5 Questions to Ask When Picking Your Heirs


Deciding how to distribute your assets can be the trickiest part of the estate planning process. Here are 5 questions you must consider:

  1. Will you divide your assets equally or base them on financial need? On the surface, distributing assets equally among heirs seems to be the most logical approach. However, there are cases where a need-based distribution is preferable; for example, if there is a large income discrepancy among heirs, or if one adult child has made significant career sacrifices to manage elder care responsibilities. In either of these situations, an equitable split may create guilt in the wealthier heirs and resentment in those who are less financially secure.
  2. Do you have reason to believe your heirs cannot manage their finances? Those suffering from alcoholism, drug addiction, a gambling problem, or a mental disability may need assistance in handling an inheritance. If someone you want to give money or property has one of these issues, it may be a good idea to create a trust. The appointed trustee will make sure the funds are used in a proper fashion.
  3. Would you like to provide the startup capital your adult child needs to start a business, or help a grandchild pay for college? Making a lifetime gift allows your heirs to receive their inheritance sooner; it also allows you to witness your heirs' enjoyment of the money and gives you peace of mind in knowing it is being spent in a productive manner.
  4. How do you plan to handle the distribution of sentimental items? In many ways, items of sentimental value can be the hardest to distribute. Cash can be divided between multiple parties, but your great-grandma only had one wedding ring. Having a frank discussion with your heirs about these items ensures fair distribution and avoids potential arguments later on. Items that no one expresses a clear interest in could be donated to a local historical society.
  5. Are you concerned that a large inheritance will leave your kids less motivated to make their own way in the world? This is a common concern, particularly among people of means. If this is the case, you might think of leaving a portion of your assets to your heirs and leaving the remainder to a charity you're passionate about.

How Can We Help?

Consulting an experienced estate planning attorney is the best way to ensure that you’ll be prepared no matter what the future holds. If you are in need of legal representation relating to an estate planning issue, please call our office at (626) 683-8113 or email us at info@PasadenaLawOffice.com.