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Stephen Beroes, Elizabeth A. Beroes, Julie Elizabeth Beroes, and Shanice Williams
Stephen Beroes, Elizabeth A. Beroes, Julie Elizabeth Beroes, Shanice Williams

Estate planning for challenging family members

On Behalf of | Dec 18, 2020 | Estate Planning

Every family has their own unique circumstances concerning their wealth and financial planning. Estate planning should address a family member that has special problems or issues who are sometimes known colloquially as the black sheep of the family.

Estate documents can cover many problems. Families may have a child or sibling with a substance or alcohol abuse problem, who is financially irresponsible, has emotional problems or mental illness, or with low motivation. An inheritance may be used as an incentive for future behavior such as completing college.

Unequal treatment

There is no requirement that each beneficiary receive equal treatment. Disinheritance or unequal distributions occur frequently for important reasons and not as disapproval of behavior or lifestyle choices.

For example, a family member may receive a lower inheritance so that another family member with a disability can inherit more assets to pay for future medical or caregiving expenses. Or disproportionate allocations may be used when another child already received generous financial gifts to pay for their home or education.

This plan should be revaluated periodically. Situations change and estate documents can help encourage beneficiaries to make progress. You should also explain unequal distributions in your estate documents or in a separate letter to help avoid legal claims against the estate or hurt feelings among family members.

Trusts offer control of your estate

After you die, you have no direct control over your family. But trusts and other estate documents can contain terms that help assure your wishes are carried out.

Trusts may have its trustee distribute assets upon achievement of a life event such as college graduation or marriage. Other contingencies allow distributions for the purchase of a car if the beneficiary holds a job for a designated time or for housing and food expenses if a substance abuse rehabilitation program is completed.

Trust assets may be distributed over time so that the inheritance is not used up all at once. For example, the trust may allow 25 percent distribution when the beneficiary is 25, 35 percent at 30 and the remainder when the beneficiary reaches 35.

Beneficiaries can receive their allocations at different times. The responsible child, for example, can receive their share in a lump sum while another less responsible child can gain access in a staggered method or when they achieve certain incentives.

Our attorneys can provide options that help meets your family’s needs. Lawyers may also prepare the appropriate documents for your estate.