Over the years, I’ve learned that the most difficult estate planning problems do not involve legal or technical issues.  They involve human nature.  It’s easy to tell someone which estate planning documents they need.  It’s impossible to tell them how people will react when they die.

 

The choices you make today when planning your estate could cause problems long after your death.  Here are two “poison pills” that may lead to unexpected consequences. 

 

? Selecting the wrong person as your executor or trustee

 

The person you choose to settle your estate is very important.  Your personal representative has several duties to complete after your death.  If you have a will that needs to be probated, your representative has to locate the will and file it with the court for probate.  He must then appear before a judge to be appointed to act for your estate.  Once he is appointed, he has to notify all the beneficiaries named in your will, gather up the assets in your estate, file an inventory with the court and pay your creditors.  Any remaining assets will be distributed to your beneficiaries.  It is important to select a representative who is trustworthy and has the time to take on the job.  If they live too far away, they may not be able to properly attend to estate business.  Once you’ve made your choice (but before you sign your estate planning documents), discuss it with them and ask whether they would be willing to serve.

 

? Rewarding the “bad” child

 

Do you have a son who borrowed money from you over the years and he never bothered to pay you back?  Are your other children good money managers?  If your assets are divided equally among your children when you die, your son will end up with more than the other children. The other children may feel like they’ve been penalized for being responsible.  

 

You may want to “even up” the amounts given to your children if you think it could cause resentment.  Make a good estimate of what your son has borrowed over the years.  Then put a provision in your will or trust to deduct the amount borrowed from his share.  In fairness, you should make him aware of your plans.  This will avoid any surprises and it may also encourage repayment of the debt.  If he does make payments, keep written records of the payments with your will or trust.

 

Disclaimer: The information provided in this column may or may not match your individual situation. Be careful not to treat this column as specific legal advice, as it may not meet your individual needs. It may give you a solid basis for discussion with your own attorney. You should consult with your personal attorney before you take any action on this or any legal issue. Also, please be aware that laws change, so this column is valid only as of the date it was published. This communication does not create an attorney-client relationship between the author and the reader.