Passing on heirlooms without passing on drama

By Fidelity Investments By Fidelity Investments | October 11, 2023 | Lifestyle Sponsored Post

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Clear communication is key to avoiding conflict.

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Key Takeaways:

Not being clear about who should get your heirlooms and why can lead to conflicts within families.

A written plan that clearly articulates your wishes and the thinking behind your decisions can go a long way toward avoiding drama.

Be sure to talk to your family about your wishes and listen to their perspectives when developing your plan.

Would you choose to spend almost $30,000 on an antique that was only valued at $1,000? Pamela Pirone-Benson, a vice president on Fidelity's Advanced Planning team, knows a pair of siblings who did something like that-all because their relative didn't specify which one of them should inherit it. The resulting legal battle between them was costly, both monetarily and emotionally. "It can get quite ugly when we're talking about heirlooms if the person who passes away hasn't outlined where exactly they should go," says Pirone-Benson.

First and foremost, you want to leave behind a functioning family unit where everyone is on good terms. Not preparing for how your valuable or sentimental heirlooms are distributed after your death can introduce friction between siblings and close family members, seriously imperiling your family's ability to stay close after you're gone. Sometimes, even if you do have a plan, not clearly articulating why you made a particular decision can cause problems.

"I think the biggest mistake," says Pirone-Benson, "is being silent and not putting anything down in writing. Generally speaking, you don't see legal disputes and major arguments when things are written down. If you're silent, you can open up the estate and your heirs to all sorts of issues."

Some consequences of insufficient planning

Failing to communicate what you want to happen with your important heirlooms can have serious unintended consequences.

Unfulfilled intentions. Without a clearly documented and communicated description of your intentions, your heirlooms may not end up where you want them to or could end up someplace you would never have wanted or expected. Pirone-Benson recalls a case where a woman left her jewelry to her spouse, assuming he would pass it on to her granddaughter—instead, it ended up with her widowed husband's new girlfriend.

Hurt feelings. Family members may not understand why you chose to leave an heirloom to a particular person and not them; they may feel slighted or underappreciated, as if you didn't care for them as much as others who did receive something. If the heirloom has significant monetary value, they may feel as if they have lost out on a potential windfall.

Personal and legal conflict. Hurt feelings and disagreements can lead to conflict, either personal (a falling out between family members in dispute over an heirloom) or legal (challenges to the will, legal suits among family members fighting over the item).

This can be a particular problem when there are existing resentments among family members.

"Typically, it's the emotional aspect of the item and the desire to possess it that drives the conflict," says Pirone-Benson. "Unfortunately, I would say sometimes a member of the family may just be looking to make things more difficult for another family member and cost them angst and money and time."

"You need to take responsibility for your legacy, and this includes addressing your personal items," says Pirone-Benson.

5 ways to help avoid family conflicts

If you're looking to avoid leaving behind a big mess when you leave your heirlooms to your family, Pirone-Benson suggests this 5-step blueprint for helping avoid family conflicts.

1. Write it down. Draft a memorandum of tangible personal property, as well as a detailed inventory of the items you wish to pass on, to whom they should go, and where they are located. "It's not a part of the will," says Pirone-Benson, "it's a separate letter, dictating to the executor what assets go to whom." She also suggests taking photographs when putting together your inventory, to ensure everyone understands what items you are referring to. The more you can do to be clear about who gets what and why, the better. "My grandmother physically marked things before she passed away," says Pirone-Benson. "So you'd look in a vase and you'd see a tag that said 'Aunt Maryann,' and we knew who it was for." For certain rare or potentially valuable items, such as antiques, artwork, or collectibles, you may want to consider hiring a professional appraiser to obtain an accurate assessment of their value.

2. Be sensitive to existing issues. If you're aware of existing conflicts between family members that may be inflamed by an uneven distribution of heirlooms, factor that into your decision-making, and ensure that your will or memorandum are crystal clear to dissuade potential legal challenges that could cost your surviving family members money and peace of mind.

3. Anticipate and mitigate potential problems. "Many people are able to identify what they see as a potential conflict down the road," says Pirone-Benson, "and they're able to get ahead of it." In the case of disputed heirlooms or items that cannot be divided, consider giving the person who isn't receiving it an alternative gift (another sentimental item, or a monetary gift of similar value). Consider including a clause in your will that instructs what will happen if beneficiaries cannot agree on how things are distributed.

4. Talk to your family. Sit down with your inheritors and explain your decisions clearly. Listen to your family's reactions and consider their feelings; perhaps their perspective will change your perception of the situation and lead you to reevaluate your decision.

5. Talk to your executor. Be sure to choose someone you feel is (and your inheritors will regard as) impartial and objective to be your executor. "A non-family member, someone with no personal interest in any of this, might be useful," says Pirone-Benson.

"It helps to remove the emotion-they simply do what the document says." Sit with your executor and make sure the intentions behind your decisions are clear so they are implemented appropriately.

You can't take it with you

As with all estate planning topics, you should consult with your attorney to discuss your personal situation and determine the right course of action for you. Pirone-Benson suggests taking care of things as soon as you can.

"The best strategy," says Pirone-Benson, "is to do as much of this as you can while you're still alive." While it's important to document your wishes to ensure things are handled appropriately after you die, handling much of this while you're around and able to do so personally can be a big advantage. Have the conversations, convey your intentions, and perhaps give away your heirlooms while you're alive so you can be clear and up front about why you made your decisions. Adjust your plans if conflicts arise, and enjoy your family's happiness as they receive these meaningful gifts directly from you.

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