When Is the Best Time to Divide Your Estate?
No one wants their wealth and property to go to waste after they die, especially if they have worked hard for it. However, adopting the general “Leave it to the children when I die” approach may only lead to potential waste of property and resources.
If you have surplus property and wealth, it is best to make momentous gifts before leaving this world. This way, it is more beneficial for everyone in your family than simply passing on the assets through estates. Most of the time, living longer means wealth is being passed down a little too late to be of good use to the next generation.
When is the best time to give away your property?
While it is not advisable to distribute property and money very late in life, you don’t have to give it away too early either. In Townsville, lawyers who specialize in estate planning advise clients to plan and divide their wealth several years after retirement.
After retiring, an older person still has personal plans, and they might need their savings to sustain their activities and dreams. When they reach their late 60s or early 70s, they will get a clearer view of how their retirement years will pan out. This is just the perfect time to plan out how they will divide their wealth among their beneficiaries or heirs.
Who should your give your wealth to and how much to give?
The most delicate part of the planning and dividing wealth is working out who among your children and grandchildren will get what and how much. Some people write out a will that assigns different amounts of money and pieces of property or estate to different family members.
Doing this while still alive can build resentment, so more and more people are taking the practical means of inviting a financial planner or lawyer to have a dialogue with the whole family.
If a family member really needs financial support more desperately than the others, it can be well explained in the dialogue why they are getting their inheritance up front.
There will be less tension if it is also clearly explained that their share in the last will and testament shall be reduced or completely erased. They should not, therefore, ask for a share on the inheritance or property handed down to other family members.
What should you keep in mind in terms of looking after heirs?
Family dynamics are very complex, and there are children with children and others without. Some grandparents skip a generation and opt to leave their properties and wealth directly to their grandchildren.
However, doing this can make the childless offspring feel unworthy. This is why it is suggested to give fixed amounts of inheritance to the grandchildren and just divide the rest equally among the children.
In some cases, wealthy grandparents choose to set up a trust fund for their grandchildren, so the young ones still learn the value of hard work and earning. Trustees simply allocate funds when needed or release the amount in full when the child reaches the age of maturity.
When it comes to giving gifts, especially inheritance, sooner is better than later. Distributing property and wealth should be well planned and thought out.