People who are doing their estate planning often think about their high-value assets first. They decide who’s going to get the house. They divide the contents of their bank account. They consider what to do with their investments or their life insurance.
It is true that all of these things are important, but don’t let that importance make you think you don’t need to address your low-value assets. The truth is that a more comprehensive estate plan is always going to be more beneficial. In the case of many low-value assets that have a lot of sentimental value, you may even be able to reduce the odds of a dispute between your heirs.
Why do disputes happen over assets with little value?
It may seem counterintuitive that the low-value assets often spark more disputes than the high-value ones, but the fact is that this is an emotional time for your heirs. They are going to cling to things that they have an emotional connection to, and those things are going to seem more important than money.
For instance, people have gotten into estate disputes over minor family heirlooms, like a bowl or a painting or a book. The value to them is that this was an item that their parents owned that was important to them. They want to make sure that they get it because they want that connection with the person that they’ve lost.
With other assets, that don’t have a sentimental value, an easy way to solve disputes is to sell those assets. The heirs can then divide the money that they make in that sale. However, with family heirlooms and other things that cannot be replaced, selling is not really a viable option. An heir isn’t going to get into a dispute over a book because they can’t go out and buy their own copy of the book; they’re going to do it because they want that very specific copy.
With few options, these types of disputes can really drag on.
Creating a plan for your family
At the end of the day, the most important thing you can do is to strive to create a plan that focuses on what is really best for your family. It’s not all about money. You just need to know how to set the plan up so that it works for the people you love.