Estate planning involves a lot of decisions around how you want your assets to be handled once you pass. While many people think of assets with a lot of financial value, like investment accounts and real estate, there are other assets that are just as valuable, and potentially even more important, that should be included in your estate plan.
Although these items might not have much monetary value, they are those items that have significant sentimental value, such as family photographs and family heirlooms. It is also important to have peace of mind about where items like these will go once you die.
Planning for Assets with Sentimental Value
Although assets with a high monetary value may appear to be the most common basis for family disputes after a loved one passes, personal items with significant sentimental value can also be a big source of contention. Emotions are already running high when a loved one dies, and many choose to focus those hurt feelings in ways that are not very productive. Consequently, seemingly small things can cause big conflicts.
When it comes to treasured items, loved ones may feel entitled to, or desire to keep, the treasures and memories of the lost one. To keep your loved ones from having the stress of fighting over such items, not to mention court costs and legal fees involved, clearly provide guidance for these sentimental treasures in your estate plan.
A Personal Property Memorandum
When distributing personal property, one of the best ways to provide guidance is through a personal property memorandum. In this document, you and your attorney can outline specific personal property and who will receive that property when you die. You should also still provide for the distribution of your property in your trust and will documents. The memorandum will act as more of an addendum to your other estate planning documents. To ensure the memorandum is legally binding, it should be referenced explicitly in your other estate planning documents and comply with state laws.
One of the advantages of a personal property memorandum is that you don’t have to formally amend your will or trust to make changes to the memorandum. Instead, this allows you to amend or add to your list or change how you wish to distribute the property.
While it is still recommended that you include items of significant monetary value in your trust and will documents, a personal property memorandum is extremely valuable when protecting and distributing items high in sentimental value. If you don’t have a plan for these items, they may end up in the hands of someone you didn’t intend to receive them.
By creating this document, you can explain why you chose certain people to receive such items, which can go a long way in avoiding disputes and hard feelings. Further, you can ensure your loved ones know the importance of these items to you. This will help them decide what to do with them after you’re gone.
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