Should I Keep My Estate Plan a Secret from the Kids?

Dear Mr. Miller:

I’m in my 90s now.  I’m proud to say that I am worth $4 million.  I’ve had a Trust for years.  I have two kids, a boy and girl.  They are both doing fine but the girl is doing spectacularly well, financially.  She really doesn’t need anything from me in an inheritance.  I’m thinking of leaving almost everything to the boy with just an “I love you gift” to the girl.

Ok, all of that is easy.  Just see the attorney and make the change.  But here’s the problem.  I don’t think I want to tell them that the boy is getting almost everything.  I don’t want to kill his desire to keep striving.  What do you think?

Loving Father

Written Notice as Substitute for “Reading of the Will”
Option to Request Copy of Trust
Problems with Attorney Explaining the Reasons for an Unequal Distribution
Share Your Estate Plan with the Family
Call Us for Other Options

Dear Father:

I think wanting your kids to keep striving is admirable.  But the rest of it; I’m not so sure.  I don’t know your kids, don’t know how well they get along or the jealousies that exist (or will exist) from your plan.  Or whether telling them will actually kill anyone’s productivity.

Written Notice as Substitute for “Reading of the Will:”Here is what I can say:  Although there is no “reading of the Will” as we tend to see in movies and TV, at least not in California or any state of which I am aware, there is a statutorily required Notice that goes out to the heirs (probably just your kids) and the Trust beneficiaries (again, probably just your kids)  during the administration period after you pass.  The administration period in California lasts a minimum of 4 months from when the notice is sent.  This notice indicates that the heirs and beneficiaries can contest the Trust but also that they can request a copy of the Trust (often times the Trust and Will are simply included in the packet).

Option to Request Copy of Trust:  When I handle the administration I usually include a cover letter with the notice indicating how the assets will pass.  In your case that would disclose the fact that the daughter is getting very little.   If no cover letter or Trust were included in the packet, I would think that most people would request a copy of the Trust which would disclose the same thing.  So the kids are going to find out what each is getting no matter how you slice it.

Problems with Attorney Explaining the Reasons for an Unequal Distribution:  And here’s the rub with our plan:  you are leaving the attorney “holding the bag;”  the attorney now has to explain why one is getting the lion’s share and the other isn’t.  Is the daughter, in this case, going to believe the attorney when he tells her the reasoning or think that the attorney just screwed up?  In the latter case, we may be looking at litigation.  And this type of litigation can be expensive, maybe costing the son much of his inheritance.

Share Your Estate Plan with the Family:  But if you sit down and share the plan with the kids in a family meeting (or even individually), it is going to be more meaningful.  And you can express your love for each while explaining the whys and wherefores.  This approach won’t necessarily prevent later litigation to overturn the Trust but it certainly should substantially decrease the probability.

Call Us for Other Options:  There are other approaches to solving this problem, too.  So give us a call at 760-436-8832 to help you select the option that is right for you and your family.