Today’s New York Times has an excellent article about how important it is that parents share their estate plan with their adult children, particularly if the plan runs counter to expectations:
The day will come, or may have already, when your children think of your money as theirs.
In uncertain economic times like these, with the stock and housing markets down, credit markets tightening and widespread anxiety about the economic future taking hold, the subject of inheritance can be even more fraught for a family: parents may worry over the fate of their fortune, and children may feel the need to dip into it.
A parent’s instinct under such stress — to put off discussion until far in the future — can have its own set of costs. . . .
Succession is a natural progression, as old as the concept of private property, yet many parents never bother to tell their children about plans for their estate. . . .
Grown children who know their parents have assets typically expect the money to be left to them in equal shares, say lawyers, wealth advisers and psychologists with long experience in the legal, practical and emotional aspects of inheritance.
Parents, though, often have different plans, deciding that Morgan has enough; that Jack the spendthrift should receive an annuity; that Judy’s special needs after an accident require extra consideration; or even that the best gift is to leave the children little or nothing material.
Mitchell Gans, a law professor at Hofstra University in Hempstead, N.Y., who has helped develop some of the most complex estate plans in the country, recommends that in such cases you should prepare the will and then notify “the kids that you are cutting out — or who are getting less than the others.”
“If you have the courage to do that,” Professor Gans said, “you cut down significantly the chance of litigation after death.”
As an Estates and Trusts professor, I could make good use of a phrase that neatly sums up the unfortunate tendency to start thinking of your parents’ money as your own, even when said parents are still very much alive and kicking. Heirticipation is the best I’ve been able to come up with, but I hope some of you chime in with more inspired suggestions.