WHAT WILL OUR CHILDREN END UP WITH AFTER DEATH?
WHAT WILL OUR CHILDREN END UP WITH AFTER DEATH?
The starting point for every family is not the place they are heading - it is the structure that already exists. Families build their assets as they build their wealth - some direct, some through entities, some with partners, some in deferred accounts. And for years and years, the family builds up the balance sheet.
At some point along the way, the family works with estate and business attorneys who help it meet its planning objectives - to reduce taxes, plan for their children and mitigate liability, with the answer necessarily being entities and trusts (maybe layers of each). All of a sudden, the family holdings - the ones the owners thought of as “theirs” - are composed of entities, trusts, and newly complicated structures.
What the next generation receives is not the family’s assets directly. Instead, the next generation receives interests in the entities and trusts that own those assets. The wealthier families become, the more layers they put between their children and their assets.
Family conflict arises often from complex assets - particularly shared personal property, including vacation homes, aircraft, boats, anything that requires shared time and shared decision-making, and not merely shared money.
People fight over schedules more than distributions. Maintenance responsibilities create resentment between family members. What was intended as a gift becomes a source of ongoing friction. Money-based conflict in families tends to resolve itself over time, because money can be divided. Shared property cannot be divided easily, and the emotional stakes attached to it make rational decision-making harder, not easier.
Families should prepare for the consequences of giving each type of asset. What is the perspective of the children and the next generation receiving these assets? Should we (as advisors) care?
I’ll be discussing these ideas at the upcoming Notre Dame Tax & Estate Planning Institute, October 28–30, 2026.
Register for the conference to attend my presentation and the other sessions.
https://lnkd.in/ehEjXur5