Often times in estate planning prized possessions, such as art, collectibles, jewelry, and family heirlooms, are overlooked, forgotten about until it is too late or simply not given enough consideration. It is important when beginning your estate planning that you carefully consider these items and include them in your plans. Some things to consider as you begin are valuation and beneficiaries.
You will want to employ the help of professional appraisers in determining the value of your possessions. This will ensure fair distribution and avoid any complications with estate tax regulations.
Second, you will need to think about who is going to receive what. If possible, it is always best to communicate with your beneficiaries about the distribution of the items, so that all parties involved are aware of your wishes. We also encourage you to complete a Personal Property Memorandum, which details the items everyone is to receive at the time of your passing.
When determining who to distribute your possessions to, it is good to keep in mind the financial aspect, but also the sentimental value of an item. Furthermore, take into consideration your heirs/beneficiaries’ preferences and interests.
This second part of distribution can be tricky and a factor to remember is the “first on the scene” rule. Sometimes adult beneficiaries may reside with or live closer to you than the others and may or may not be aware that Person B is to receive Item A and will claim the item for themselves. Because there are no “trust police” there is not much that can be done to rectify this, which is why it is important to communicate with all beneficiaries involved.
One way to avoid this kind of situation though is to give away your possessions while you are still around. There are several advantages to doing it this way, but mainly because you will have complete control over who is receiving each item. Another benefit is you will have the pleasure of watching them enjoy your treasure.
In summary, as you begin your estate planning, carefully consider your valuables and how you want them distributed. Employ appraisers to determine accurate values, complete a Personal Property Memorandum, and discuss your wishes with all beneficiaries. Completing these steps will help to ensure your valuables are preserved and your wishes fulfilled.
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