With good reason, major assets, like bank and investment accounts, as well as real estate, tend to get lots of attention during estate planning, but it’s wise to think about accumulated personal possessions too. Thoughtfully arranging the gifting of material goods is a great way to reduce stress and conflict for loved ones down the road.
Personal Property Memorandum
Attorneys at Saiber LLC remind us not to forget about material goods when completing an estate plan: “Personal possessions include items like furniture, collectibles, jewelry, family heirlooms, or artwork, and they often carry sentimental or financial value. Without a plan, determining what happens to these belongings upon your death can quickly lead to confusion and conflict among your heirs.” Specifically, estate planning experts recommend making a detailed inventory, assigning beneficiaries, creating a personal property memorandum, and communicating openly with loved ones:
- Be specific about who inherits which items. Consider family dynamics and relationships, as personal belongings often carry emotional value beyond their monetary worth.By thoughtfully assigning items, you can minimize guesswork, tension, and confusion for your loved ones after you’re gone. Don’t leave these decisions up to chance—take the time now to address these matters so everyone involved benefits from peace of mind.
- A personal property memorandum is a flexible tool for assigning specific items to beneficiaries without revising your will. It can be easily updated and is especially helpful for passing down sentimental items like heirlooms or collectibles.
- Open communication with your family is crucial, especially if you anticipate more than one individual wanting particular items. By having those conversations while you’re still here, you allow your loved ones to process your decisions and avoid surprises later on.
Make A Will, Designate An Executor
Though the use of trusts has grown, wills remain useful estate planning tools, serving to outline “the distribution of finances, possessions, and property after an individual’s passing.” When a will is written, a fiduciary, known as an executor or personal representative, is typically designated to take responsibility for wrapping up the affairs of the testator (aka person who creates a will), as expressed in the will. Upon the death of the testator, the first official act of the executor is to enter the will, with a copy of the death certificate, in the local probate court—which in some states is referred to as surrogate court. At that point, the will becomes a matter of public record.
It’s important to know that every executor must “work in the best interest of all beneficiaries without showing partiality,” because as fiduciaries, they are legally obligated to ensure the affairs of the estate are properly handled, in accordance with the terms of the will–and the law. Given their significant responsibilities, in most states, it’s typical for executors to “have bonds to ensure their trustworthy behavior in their roles. These bonds guarantee that all the estate debts will be satisfied and that the remaining assets will be properly distributed to the appropriate heirs.” Information about executor bonds, as well as help obtaining them, and all types of fiduciary bonds, is available at Colonial Surety Company:
Good To Consider: Gift In Your Lifetime
Although plans to safeguard and pass forward assets and prized possessions are important, don’t forget that gifting while you have the chance to savor the results can be very rewarding. As estate planning experts remind us, gifts of time matter too:
If you have possessions that you are no longer using and no longer plan to use, it can be very rewarding to give them to a loved one who will use it or wear it. Seeing your loved ones enjoy something you’ve gifted them from your own life can bring you joy! That’s a very personal decision, of course…..For most people, it’s not their things that matter to their loved ones, it’s their time. The time you spend, and the time you’ve spent with the people you love, is what they will remember. It’s rarely about the material things.
Estate Law?
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The Partnership Account® for Attorneys
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