Talking to Your Adult Children about Your Will
A few months ago at Berkshire Hathaway's annual meeting, Warren Buffett was asked how much money he planned to leave his kids. Marvin Blum wanted to know how Buffett decided how much was enough, but not too much. “How do you keep from ruining your kids?” he said.
Buffett's answer raised some important points for wealthy parents. He plainly stated his belief that more kids are ruined by the behavior of their parents than the amount of their inheritance. He also believes when children are old enough (mid-thirties, give or take) wealthy parents should take time to explain their estate plan to the children, reasoning that “it's crazy for them to read the will for the first time after you're dead.”
Buffett's advice is especially important if you name one of your children as the executor of your estate. Your child should clearly understand how to carry out his or her obligations as executor before you sign the will, if possible.
If you plan to leave different assets to each child, be sure they understand your definition of equality while you're still here to talk about it. The last thing you want to do is cause a rift between siblings that may never heal, simply because they didn't understand why you divided assets the way you did.
Finally, consider all the other potential uses for some of your money. Buffett, who considers charity to be an individual's responsibility to society, said:
I do think that if you're very wealthy … the money has far more utility to society than to create a situation where your kids don't have to do anything in life except call a trust officer once a year and tell him how much money they want.
Whether you leave your entire estate to your children or divide it among your children and your favorite charities, consider explaining your plan to your children if they are mature enough.
Peterson Law Group offers comprehensive estate planning services for families of all shapes and sizes. For advice and assistance drafting a will, trust or any other estate planning need, contact an experienced Bryan-College Station, Texas estate planning attorney at Peterson Law Group at 979-703-7014 or fill out our online contact form.