What Happens to the Tangible “Stuff” from a Parent’s Estate?

Sophie and her sister and two brothers grew up in a large home with lots of stuff. Their mother, Nancy, liked the finer things in life including Oriental rugs, artwork, fine jewelry, antiques, and collectible coins. Nancy and her late husband, George, were also sentimental and kept photo albums, collected special pottery that was sent by relatives each Christmas, and accumulated meaningful mementos from family travels.

When Nancy died at 95, the executors — Sophie and her brother — created an inventory of more than 500 items in her estate that had sentimental value. They made another list of those items with monetary value, including Nancy’s jewelry, rugs, artwork, and silver, gold and collectible coins. The four siblings agreed to sell the coins and the other items of monetary value and were left to figure out the best way to deal with the many sentimental items. Their goal was to find a way that was fair and wouldn’t cause conflict or ill feelings among them.

Distributing Tangible Property

As the nation’s 76 million baby boomers age, more families are being faced with how to divide personal belongings. Adding to the challenge: there are more family members in the mix because of changing family dynamics, most often because of divorces and remarriages resulting in blended families.

Estate planning documents such as Trusts and Wills should always cover the transfer of cash, real estate, and other financial assets, but sometimes people skip over exactly who gets the household possessions.

More and more these days, the children don’t want their parents’ collections and personal belongings. But sometimes these small, memorable pieces are more valuable to people who were close to the deceased than any amount of money or property would be. If they’re not accounted for in the estate planning documents, deciding who should get wha often falls on the shoulders of the Trustee / Executor, and can make for some difficult decisions.

Avoiding Conflict

Distributing property is not always as straightforward as we might like it to be. Particularly where there are multiple children or a number of other family members who need to be included, some conflicts over who gets what can sometimes arise. Disagreements over who gets what can lead to bawling and brawling between siblings that can scar relationships forever.

Here are effective some ways to deal with personal property after a death, in a fair and (hopefully) peaceful manner:

1. Don’t allow family members to help themselves: To keep the peace and avoid unnecessary conflict, experts typically encourage an impartial game plan. One executor, who was very prepared and intent on keeping the peace, divided his mother’s possessions into four categories: antiques and furniture, kitchen and electronics, figurines and collectibles, and jewelry. He hired an appraiser to establish value on larger antiques and discussed the fairest way to divide everything among his four siblings. They then drew numbers out of a hat to determine the order of picking, having a “draft” of sorts.

2. Have a “pre-sale” for family members: If a family decides to have an estate sale, some families hold a “pre-sale” after the items have been given a value. Family members can select the items they want, but not pay for them. Their value is deducted from their total proceeds once the sale is over, so no one can say at the end that “you got more than I did.”

3. Hold a family auction: The default method that we have used in our wills and trusts for at least 20 years is to hold a family “auction,” allowing all beneficiaries an equal opportunity to bid on items. Each child is given 100 points with which to bid on items. They executor or trustee prepares a list of items in advance and provides that list to all beneficiaries, so that everyone knows what items are going to be auctioned and in what order. Children can all be “present” at the auction at the same time either in person or by phone. photographs of each item can be sent to everyone by email ahead of time if necessary. The trustee or executor acts as the auctioneer and once each child has run out of points, then each child is reallocated an additional 100 points so that the remaining items can be auctioned off. A similar type of action was discussed in a recent Forbes article, the author discussed how each of four siblings was provided with 500 virtual poker chips, which he or she could use to bid for contested items. Before the deadline for bidding, the siblings had the chance to talk with one another about their intentions. After the auction, the executor readjusted the estate monetary distributions based on the fair-market value of the items each person chose, to ensure that everyone came out at the same place financially.

4. Use colored stickers: You can get family members to place colored stickers (similar to those round garage sale price stickers) on the things they want to keep. Any items which have only one colored sticker on them will automatically go to that person, whereas those which end up with more than one can be further debated later on.

5. Copy what you can: Things such as family photos and videos can be difficult to distribute fairly, but thankfully are very easy to copy or scan digitally. Digital images and videos can be distributed electronically, and even printed photos can be copied onto high quality digital or hardcopy images.

6. Divide stuff up ahead of time: For some families, the parent or grandparent wants to divvy up the possessions ahead of time, or it happens naturally through downsizing. If decisions are made prior to a death, they can reflect the owner’s wishes. It also gives the parent or owner a chance to share stories, history and traditions, so it might be a wise idea to consider.

If your family still cannot come to an agreement, seek advice from someone outside the family, such as a family mediator. A family mediator’s job is able to analyze these situations fairly and objectively, and help families find areas of common ground. Please see our Trusted Referrals of Other Senior-Serving Professionals for recommended mediators and/or other professionals that could possibly help.

Estate Planning: Get Your Affairs in Order to Make Things Easier for Loved Ones

Estate planning is all about what you leave behind to your children, grandchildren, or other intended beneficiaries upon your death. It includes what is left in your retirement accounts, savings, your real estate, and your life insurance policies, as well and tangible items of value and importance.

If you die without proper estate planning, it could create unnecessary headache for those left behind and needlessly waste a significant portion of your assets on taxes, attorney’s fees, and probate expenses. This is why it is important to have an experienced estate planning attorney, such as those here at the Farr Law Firm, create your estate plan — your will, trust, account titlings, and beneficiary designations — to make sure everything is up-to-date and appropriate for your stage in life.

Once completed, it is wise to review your estate plan at least every 3-5 years and make necessary updates accordingly, or to join our Lifetime Protection Program to ensure that your documents are up-to-date each year. Read more about estate planning here.

We here at the Farr Law Firm have strategies in place to help our clients plan for themselves and their loved ones. If you have not done your Estate Planning or Retirement Planning or had your planning documents reviewed this year, please call us as soon as possible for an initial consultation:

Estate Planning Fairfax: 703-691-1888
Estate Planning Fredericksburg: 540-479-1435
Estate Planning Rockville: 301-519-8041
Estate Planning DC: 202-587-2797