Don't forget personal property
By Michelle Tucker
Special to The Advertiser
Planning for all of life's contingencies is a difficult task, yet one that must be attempted. This is especially true when dealing with your death.
Prudence suggests that you create an effective estate plan delineating your wishes as to the care of your minor children, your burial arrangements and the disposition of your assets, to name a few. However, even people who meticulously prepare such plans often overlook their personal property, which can cause problems.
Here's an example of how things can go wrong: Several years ago, a widower passed away. He thought he planned out every detail of what would happen after he was gone. He had family discussions about how his major assets were to be divided, but he never considered his personal property in his plan.
His children are still not talking to one another because of disagreements regarding how to distribute items that were dear to them. The daughters were especially embittered over their mother's art collection. Friends and relatives demanded furniture and tools that they claimed the widower had promised them. The family remains divided.
In addition, the executor of the widower's estate faced an overwhelming task. Past financial records were mixed with correspondence, other documents and photos. Everything was stored in paper sacks. It took the executor more than six months of tedious work to go through the papers and documents.
The widower's family and the executor suffered hardship and anger that could have been avoided had the widower paid as much attention to his personal property as he did to his other property.
Other problems can arise from ignoring personal property in preparing and maintaining your estate plan. Often, family or friends quickly take personal items before the estate is settled. This can be a significant hindrance in assessing the estate's value, especially if items of substantial value are taken before a proper inventory is conducted.
With proper planning, these complications can be avoided.
For example, an elderly couple created a proper estate plan with a living trust and health-care powers of attorney. They categorized all of their assets and discussed their complete financial status and necessary actions with the child who lived closest to them. They discussed their personal property with their family and close friends, learning each one's preferences for personal items.
The couple took an inventory indicating who was to receive each piece of personal property. They made copies of certain photos and family documents, and designated who would retain the original. They referred to this handwritten and signed inventory in their estate plan.
The husband and wife died within a short time of each other. The estate was distributed without incident. Family and friends were thrilled that the couple had thought enough of them to include them in the dispensation of their personal property.
With some effort on your part, you, too, can minimize the complications that could arise after you're gone. To accomplish this, you can create a legally enforceable document assigning items of importance to someone by name and note how items not designated for anyone should be disbursed. In addition, you may want to address what will happen should an item mentioned in the document no longer be a part of your estate at your death.
As with every aspect of your estate plan, you should seek the assistance of a qualified expert in estate planning to make sure your plan is legally acceptable and meets your desires.
Michelle Tucker is Hawai'i's first recipient of the professional designation of estate planning specialist and is a partner with Judith Sterling in the Honolulu law firm Sterling & Tucker, www.sterlingandtucker.com.