Eight Complex Inheritance Problems

Eight Complex Inheritance Problems

Eight Complex Inheritance Problems, When there's a death in the family it often brings up conflict. People can feel jilted when they did not get what they wanted or expected out of the will. And often this leads to complex inheritance fights that rarely end up going the way anyone had hoped they would go when everything began. So here are eight complex family situations that can make dealing with inheritance difficult.

1. Sibling Rivalry

When parents die, lots of tension can arise between siblings – especially if they were not very close to begin with. But even when there's a good relationship there can often be hurt feelings during the distribution of an inheritance. Oftentimes people can not let bygones be bygones, and past wrongdoings end up coming into play and causing an even bigger rift.

Or sometimes, it's the expectation that one sibling has to pay more for the cost of the funeral expenses because other family members are unable to contribute. Then when it comes time for inheritance, some think they are more deserving of the piece of the pie than others.

If you hire a fiduciary to be the trustee, this can help keep everything equal. This person has no stake in the family issues whatsoever and can mitigate the effects of the estate.

2. Different Socio-Economic Backgrounds

When you have heirs of the inheritance who come from all different socio-economic backgrounds, you can often feel that one should get more than another person because they are more in need. And the one who has greater needs gets angry at the one with more substantial means because they do not understand the situation.

Even the most tight-knit families might not be able to survive the complexities of a financial inheritance. A wealthier heir might want to keep something like a house, whereas other heirs might want to sell for quick cash.

This can be avoided if there are clear instructions in a will that states how the property is to be divided and managed (ie sold and profits split equally).

3. Co-Trustees

It's hard for more than one person to make decisions together in many cases, but especially in the case of splitting up a loved one's estate. Quick decisions must be made when it comes to distributing an estate.

It's much better if there's only one executor of the will. You might not want to seem like you're taking preference over someone, especially parents who have more than one child, but in the end it's just better to have one trustee appointed. Giving specific instructions for that person to follow might help ease some of the other blows mentioned in this piece.

4. Dependency or Mental Illness

When a beneficiary has some sort of dependency or mental illness, this often causes lots of strife.

The best that can be done for substance abuse concerns, is to have provisions in the will that the beneficiary has to be clean and sober for a certain amount of time to receive the claim. For mental illness, a trust can be established that allows the beneficiary to receive trust disbursements, but still be able to qualify for government assistance.

5. Elder Abuse

As someone grows older, their caretaker can have a lot of influence over a person and can convince them to do things. It's important for family to be as involved as possible in the care and as equally as possible to avoid any undue influence.

6. Estrangement

Disinheritance is a common thing. And it might be truly warranted, like in the case of an heir who abused the deceased in some way. In this case a disinheritance will hold up in court, but anyone who's left out of the will that truly believes they are entitled to an inheritance is going to contest it. So it's important that you do not disinherit someone just because you're mad at him or her.

Things get even more complex when you have blended families. The law only recognizes certain people as heirs so it's important that you make sure you have an updated trust. You should have your trust reviewed every 5-7 years to make sure you take into account any new or changing laws that might apply after you die.

7. Marriage / Divorce

Marriage and divorce is always complex, but when you have exes and new spouses or you get married late in life, perhaps to someone younger, there is often a lot of questions about who should receive the inheritance. And heirs often resent a new spouse when you get married late in life.

It's important, especially in this case, to have a clear trust established with instructions of who is to receive what. This will help avoid some of the conflict that could arise.

8. Advancements of Inheritance

Sometimes people will give part of their heir's inheritance as start-up funds for a new business or something similar. But then later there are hard feelings when going through probate and it's discovered that a portion of the inheritance was already given out. The gift should be notated in the trust if it was an advance of the inheritance so it does not appear that someone is double dipping on the inheritance.

Hopefully preparing in advance and giving clear instructions of how an inheritance should be distributed will keep the fights at bay after your death, at least over inheritance. Money does do strange things to people, so you never know what will happen.
Finance UMUM
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