Best Practices for Dividing Family Assets

Dividing your assets to ensure family harmony can be easier said than done. Here we explore 8 ways to make the process smooth and simple - even in difficult situations.
Close up of a last will and testament document

Dividing up your assets to ensure family harmony can be easier said than done. If you’re at the point of deciding ‘who gets what,’ here are key things to keep in mind. Ultimately, you are making a decision that can contribute to and create harmony—or provoke endless squabbling. If you’re having trouble dividing your family assets, allow us to shine some light on this sensitive topic. Let's dive into this Senior Assistance Club guide on dividing assets for seniors!

Getting Expert Help

If your situation is simple, you may want to consider making a will online.

However, for many people, relationships and assets are complex. The issues regarding distribution of assets amongst family are complicated and often deserve expert attention.

If you’d like to get expert advice, one of the first people to talk with is an estate planning lawyer. These professionals are highly skilled in the instruments, means, and ways to navigate the turbulent waters of asset division. They are well-equipped to offer legal tips for seniors to help ensure the entire process goes smoothly not just for you but for all those involved as well.

If you have a religious or spiritual practice, you may want to discuss distribution of assets with this person. A minister, monk, priest, rabbi, or leader is likely to have the unique objective understanding of your family, interactions, history, and issues at play. They can bring a broader perspective to the situation including historical, interpersonal, religious, and spiritual understanding.

Experienced professionals have seen it all. They have witnessed how families come together and fall apart regarding the distribution of a senior’s assets. Conflict, friction, and stress often emerge as issues of inheritance come to the foreground.

In the name of peace-of-mind, and harmony, many experts agree that advance planning helps to minimize problems and maximize harmony.

How to Divide Family Assets

Dividing up your family assets can be tricky. Some people are more logical. Others can be more sentimental. Some members of the family may feel entitled to receive more than others. Some children may be physically or psychologically closer than others.

One or more children may live near-by the family home, and dream of raising their children in it someday. One or more children may have been more involved in caring for you and your spouse.

It seems challenging to come up with a peaceful, perfect solution. Yet, in many cases, the simplest, most gracious, and most peaceful decision is equality. Simply, leaving an equal inheritance as your legacy.

Equal distribution of your assets is a statement of harmony for your family. Equality sends a message that you seek to foster harmony. By dividing amounts equally, you are showing fairness and respect, and are sharing wealth without favoritism.

In many families, children are living all over the country or the world. If your legacy includes real estate, you’ll need to determine the value of your home and property. It can also come down to a decision about common sense.

In other words, if one child lives nearby and has 5 children yet another does not want to be a homeowner—this simplifies your decision. You could leave your family home to the first and give equivalent cash assets to the second. Differences in physical assets, such as houses, can be balanced with cash or other assets.

Protecting Your Wishes

While many people divide family assets with the intention of leaving a generous gift, the recipients may perceive things differently.

One of the ways to protect your wishes for harmony is to include in your will a ‘no contest clause.’ Simply, this provision clearly states that if any of the beneficiaries contests the will, that person will lose his or her portion of the inheritance.

This can prevent an otherwise unhappy family member from engaging in a costly and lengthy legal battle.

Best Practices for Estate Planning

Estate planning experts have been there and done that. They’ve seen how things can go smoothly, as well as how families can become torn up by contentious battles.

Here are tips on estates, wills, and trusts for seniors and how to avoid unnecessary challenges that may arise from the division of a senior’s assets.

  • Make family harmony your top priority. When it comes to dividing family assets during estate planning, it can be tempting to play the numbers game and try to ensure that everything is divided up as fairly as possible. However, this approach can sometimes lead to further conflict and tension within families. Instead of focusing solely on money, the best way to ensure continued harmony within your family is to make prioritizing relationships your top priority. This may mean a more uneven division of assets, but ultimately it will lead to a happier and healthier dynamic among loved ones.
  • Talking to each child about your will can provide a time to explain your reasoning and avoid surprises. Talking with each child individually can give them the opportunity to ask questions and understand the reasoning behind your decisions. It can also prevent surprises or hurt feelings when they see the final distribution of possessions or funds. Of course, different children may react differently to this conversation, and it's important to be warm and empathetic while also standing firm in your choices. However, keeping open lines of communication can help ensure that everything is handled smoothly and peacefully when the time comes.
  • When dividing your family assets, it may be wise to consider setting up a trust for any children or loved ones who may not be able to manage their inheritance on their own. A trust can provide structure and guidance for how the assets will be managed and used and can ensure that the beneficiary's needs are taken care of without giving them complete control over their inheritance. This arrangement can also prevent potential conflicts among family members over the distribution of assets. Setting up a trust requires careful planning and consideration, so it's important to consult with a financial advisor or lawyer before making any decisions.
  • Many people don't realize that state laws vary when it comes to the number of witnesses required for the legal execution of a document. For example, in some states, a will only requires one witness while others require two or three. It's important to keep this in mind when dividing your family assets, as a will with only one witness in a state that requires three may not be considered valid. So before signing any documents related to your assets, make sure to check your state laws and have the necessary number of witnesses present to ensure the legality and enforceability of your wishes. This little extra step can save your loved ones from unnecessary stress and confusion down the road.
  • When writing your will, it's important to make sure that you are acting under your own free will and not being unduly influenced by anyone else. In particular, open discussions about wills and inheritances with children can potentially lead to claims of undue influence in the future. One way to avoid this is to simply leave them out of the will-writing process altogether. Your children can always be included in your final wishes but discussing the details with them beforehand could have negative legal consequences. It's also important to consider other potential influences, such as a spouse or close friend who may stand to benefit significantly from your will. Make sure that all of your decisions are made independently and without pressure from anyone else.
  • When it comes to creating a will, one important step is ensuring that the document is legally valid. One potential issue that may arise is the claim that you were not of sound mind when signing your will, also known as a lack of capacity. Fortunately, there are steps you can take to avoid this issue. One option is to have a doctor witness the will signing, providing evidence that you were capable at the time of writing. This extra precaution can help prevent disputes and ensure that your wishes are carried out after you're gone.
  • As life changes, so do our estate plans. It's important to regularly check in and make revisions to ensure they accurately reflect our current wishes and family dynamics. For example, the birth of a younger child is a major event that warrants an update to your estate plan. Without making changes, there could be confusion about who will serve as the child's guardian or how their inheritance will be distributed. In addition, it's important to consider any potential generational shifts in wealth - for example, creating trusts for younger children to provide for their future financial stability while also ensuring that older children are provided for.

While it can be tempting to save or invest all of our wealth for ourselves or our descendants, research shows that giving financially to others during our lifetime can bring us immense happiness and satisfaction. Not only do we get to witness the effects of our gifts on others' lives, but studies have shown that the act of giving activates regions in the brain associated with pleasure and trust. In addition, sharing our wealth with those who are less fortunate helps to level the playing field and create a more equal society. So, as we plan for our own futures, let's also think about how we can use our resources to positively impact the present. Giving freely and with joy not only benefits those around us, but it enriches our own lives as well!

Assistance Club Summary

The bottom line? Your decisions can promote harmony in your family. Talking to your family is a great place to start. With a clear, unswerving priority for harmony, you’ll have peace of mind in how you’re distributing your family assets.