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Estate planning and families can be a difficult mix

On Behalf of | Mar 29, 2019 | Estate Tax

Families can be complicated, particularly extended families and new families. Divorce, re-marriage and children with a second spouse can all serve to complicate family dynamics, which can, in turn, complicate estate planning. Indeed, family conflict was recently cited as one of the three main threats to the success of estate planning in California and the rest of the country. According to the recent survey, the other two are market volatility and tax reform.

Nearly half of the estate planning professionals consulted for the survey cited family conflict as the biggest threat. Contributing to this belief is the difficulty that can surround designating beneficiaries, and another factor that contributed was a general lack of communication within the family. Estate planning usually involves goals for what the plan is expected to accomplish in retirement for the principals and following their deaths for their descendants.

Tax reform and market volatility can impact those goals. The increase in the gift amount inspires some to gift large sums of money while they are still living to avoid a possible estate tax later. However, volatile markets should not be disregarded as the first priority for many to fund their retirement. This may not be possible if the principal is depleted through gifting.

The best way to avoid the family conflict that can arise is to assemble the family members and have a comprehensive discussion concerning the shared goals and objectives that can contribute to the success of estate planning in California. Once an agreement has been reached, an existing plan can be reviewed or a new plan created. In either case, consulting with an experienced estate planning attorney can help get or keep your estate plan in good stead.


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