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Considerations when planning your kids' inheritances

If you're thinking about putting an estate plan in place and you have adult or nearly-adult children, there are certain considerations you should keep in mind.

First, it is a good idea to leave each of your kids assets of relatively equal value. That can prevent conflict and bruised feelings. If there's a reason why you're leaving more to one child (like perhaps that child has been caring for you for many years), explain that to everyone. If you've decided to leave the bulk of your estate to your favorite charity or your alma mater, let your kids know your reasoning.

How much should you discuss your estate plan with your kids? It's important if they have an idea of approximately how much it's worth and what they will inherit. Kids (even grown ones) often have no idea how much their parents are worth. You don't have to go into detail, but it helps to give them an estimate. Explain that it could change if you need the money for things like medical expenses.

It's best if you can divide up the responsibility for executing your estate plan among your children. Unless only one child has any interest in doing it, putting one in charge and leaving the others out can breed resentment.

Give your kids a chance to tell you if there are any items that have particular sentimental value to them. That allows you to stipulate in your will who will receive what. Many well-meaning people place post-it notes on valuable jewelry or other items in their safe deposit box or their home with their children's names on them and assume that all is taken care of. It's not. You need to list these items in your estate plan.

Many parents with considerable assets don't want to give their kids everything at once. That's where trusts can be useful. You can designate that the inheritance be disbursed in increments as the child gets older. You can also designate that it be used for specific things like college, trade school or a first home.

However, be careful about creating an incentive trust that has too many or very specific requirements. It may be your dream for your kids to go to medical school, but it may not be theirs. One might prefer to become a chef.

An experienced Florida attorney can provide advice and information as you make these crucial decisions for your family.

Source: AARP, "How to Leave an Inheritance to Your Kids," Jean Chatzky, accessed March 12, 2018

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