A significant section of your Estate Plan, specifically your Will, may be focused on how you want all your assets divided and dispersed, and to whom your belongings will be given. This can lead to questions of how much inheritance you want to give to each family member.
Occasionally, you may find yourself in a situation where you want to give one family member a larger inheritance than another. It is important to think this decision through carefully, as this can often lead to hurt feelings among family members if they believe that the decision is unfair. That is why it is important to make sure that the explanation and wording in your Will clearly states your wishes and offers a fair explanation. Here at Trust and Will, we know how important it is to keep relationships with family members intact and avoid any hurt feelings. Keep reading to find out everything you need to know about unequal inheritance, the reasons behind it, and how to best handle unequal inheritance.
What is Inheritance?
Before explaining how to handle unequal inheritance, it will be important for you to understand what inheritance really is. An inheritance is any assets that you leave behind to a specific individual within your Will. These assets can include anything from cars, to jewelry, clothes, money, 401k accounts, and more. When an inheritance is unequal, this means that the value of the assets left to each individual does not measure up to the same amount for each person.
How Common is it to Leave an Unequal Inheritance in a Will?
Leaving an unequal inheritance for your children is more common than you might initially think, and the number only seems to be increasing. In 1995, a study was conducted that showed about 16 percent of all individuals left an unequal inheritance. However, this number rose to 35 percent as of 2010. So, if you are someone considering leaving an unequal inheritance, rest assured that you are not alone.
Reasons for Leaving Unequal Inheritance
There are many possible reasons as to why you might choose to leave an unequal inheritance among children, and we have listed a few possible reasons below.
One of the number one reasons people will choose to leave unequal inheritance for children is when one of your children becomes your primary caregiver later in life. It is common for parents to want to leave their child who was their primary caregiver in their final years a larger sum of inheritance in their Will to repay them for all of their help. It may be that your child refused payment for being your primary caregiver, so you want to find a way to give back to them for all they did.
Stepchildren vs. Biological Children
It may be important for you to differentiate the amount of money you leave your biological children vs your stepchildren, particularly if they became your stepchildren later in life. You and your spouse may have split assets and split Wills in which you each are leaving different amounts to your respective biological children.
Considering Each Child’s Situation
It is possible that you may have given one child in particular a large sum of money well before you passed. To make things fair for your other children, you might consider leaving them a larger portion of your assets. Or, perhaps one child is not as financially stable as the others, or disabled, and you want to leave them a larger inheritance as a safety net. These are just a few of the many factors that you may be considering when evaluating each child’s individual situation and how much you want to leave them.
3 Tips for Leaving Unequal Inheritance
When leaving unequal inheritance, follow these steps to help avoid hurt feelings or potential conflict among your children.
1. Be Honest
If you choose to leave unequal inheritance for your children, one of the best ways to avoid hurt feelings and resentment among your children is to have an open and honest conversation with them about why you made your decision. If you sit down with each individual child and explain how you have come to the decision to leave them their allotted inheritance, you are eliminating room for confusion and are also giving your children the opportunity to ask questions before you pass away. This will help alleviate any hurt they may feel over your choice as they will have the chance to bring up their concerns.
2. Be Clear and Concise in Your Will
When writing your Will, it will be important to think about how you are wording your intentions when leaving directives for distributing inheritance. By making sure to be clear and thorough when writing your Will, you will be able to help decrease the confusion that your beneficiaries may have.
3. Hire a Mediator
If you feel that conflict may arise when discussing unequal inheritance among your children, you can choose to hire a mediator who is a professional that can help your children work through their frustrations with your decision and be a sounding board during the discussion. This will help keep the conversation on track and not get out of hand.
Deciding how to split up inheritance among your children can be a difficult task that will require ample thought and consideration. Creating your Estate Plan while also making these important decisions can seem stressful and difficult. We want to help make Estate Planning easier for you with our online Estate documents and services. With Trust and Will, you can create your Will, Trust-Based Estate Plan, and Nomination of Guardianship documents all online from the comfort of your home. If you are unsure where to begin, we offer a free online quiz to help get you started.
Is there a question here we didn’t answer? Reach out to us today or Chat with a live member support representative!