While many parents wish to spread their estates equally among any adult children, this is often easier said than done. If one child earns more, it may be tempting to provide the other children with more money to protect their financial future. However, an unequal payout could lead to animosity between the surviving children.
Ideally, any estate plan will try to ensure that the children are treated fairly. For instance, if the family agrees that providing one child with a down payment for a home is warranted, there may be no reason to compensate the other children similarly. However, if all the children were expecting to get a lump sum of money for a down payment or to take care of other debts, each child could be included in the estate plan.
One solution is to create a trust for each child. This allows a parent to provide for the needs of each child through flexible terms. For example, it may be possible to keep family heirlooms in one trust while providing money to another child if he or she needs it in the future. This may enable a parent to maintain harmony among the children.
The use of wills and trusts may increase the odds that all heirs are happy with their inheritance. Having a conversation with the intended beneficiaries ahead of time might also make it easier to determine what is fair and what each person values the most from an estate. Those who need help creating a plan or ensuring that it is executed correctly may wish to talk to an estate planning attorney.