The composition of families of the baby boomer generation have been less traditional, due to more couples entering into second marriages or living together without getting married. A recent report from BMO Wealth Management found this could greatly complicate asset distribution to heirs and beneficiaries after a parent's death. For families in Minnesota, this could lead to more legal wrangling.
According to the report, estate planning is insufficient and other warning signs exist. Over half of surveyed adults, 52 percent, did not have a will, and this rose to 56 percent for adults between 35 and 54 years old. The survey found that 40 percent of potential heirs thought that their parent's estates were inequitable, and unmarried adults were most likely to believe they were treated unfairly. A minority of adults, 28 percent, knew about their parents' wills or plans to distribute their estates.
There was a failure to share information because a small number of parents, 40 percent of parents, shared intentions over their estates with their children. Only a quarter of married adults claimed that their spouses knew where their wills or powers of attorney documents were kept.
Having a will and estate plan in place can prevent fights and legal battles over an inheritance and its distribution, regardless of the parent's wishes and intent, under Minnesota's intestacy laws. Wills should be updated as marriage, family situation, desires on asset distribution and financial circumstances change.
Communication can help prevent family disputes and court fights. Distribution of assets should be explained and documented. Appraisals can help ensure that the value of property such as artwork or jewelry is not later challenged.
Deciding how assets should be distributed is difficult and possibly emotional. Determining which item is important to family members, allowing an heir to select items or even drawing lots may be utilized.
An impartial executor should be appointed. A family member may be considered biased in a legal challenge.
Finally, family members and professionals such as lawyers and accountants should know the location or even have copies of wills and other important documents such as a power of attorney. Events may make quick access to these documents important.
An attorney can help parents prepare these documents and decide distribution of assets. Proper drafting and planning can help families get through a difficult time.
Source: BWO Wealth Institute, "Estate planning for complex family dynamics," Accessed May 7, 2017