In a perfect world, estate planning helps to better ensure the distribution of your assets according to your wishes. In reality, the execution of an estate plan can lead to disputes among heirs, potentially derailing your intentions. If you are concerned your family may fall into the latter group, take some comfort in the fact that you are not alone. Case after case shows how families struggle to handle the distribution of an estate after a loved one’s passing.
Though reasons for this conflict vary for each situation two common causes include the presence of blended families or loved ones with strong personalities. Whether your beneficiaries fit within one of these categories or you have different reasons to be concerned that the estate plan may result in some level of contention, the following strategies can help to mitigate these risks and increase the odds of a smooth execution of your estate plan.
#1: The benefits of lifetime gifting
Lifetime gifting can be an effective strategy in estate planning for several reasons. Gifting assets during your lifetime can help minimize the value of your estate, potentially reducing estate taxes. It can also provide clarity as distributing some assets in advance allows you the opportunity to explain your intentions if needed and may reduce the likelihood of disputes among heirs.
Gifting also allows you to see your beneficiaries enjoy and benefit from your gifts, providing the added benefit of personal satisfaction.
#2: Consider open communication
One of the most effective ways to ensure the smooth execution of your estate plan is by discussing it with your heirs. This transparency can significantly reduce misunderstandings and disputes for the following reasons:
- Sets clear expectations: It helps your heirs know what to expect, reducing the shock and potential disputes after your passing.
- Provides an opportunity for questions: Heirs can ask questions and gain clarity, ensuring everyone understands your decisions.
- May lead to revisions: Discussions might highlight issues you had not considered, allowing you to revise your plan accordingly.
Use of these approaches can not only help to reduce potential legal challenges but also promote family harmony. By taking proactive steps today, you can secure peace of mind and better ensure that your estate is handled according to your wishes.