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    Should Inheritances be Equal or Fair?

    WealthManagement.com
    Mar 14, 2019

    Stanley H. Teitelbaum, Martin M. Shenkman 

    A common issue for those trying to plan an estate, especially the dispositive
    provisions of a will or revocable trust, are the dispositive provisions. The issue is
    summarized in a short phrase: “equal versus fair.” The vast majority of people use
    equal as the default dispositive scheme and don’t delve into what’s “fair.” It’s
    simpler. It’s assumed that equal won’t create ill will among heirs in contrast to an
    unequal but fair distribution. While equal is certainly a simple default, it may not be
    appropriate or fair for heirs of varying need. But exploring what might be fair once
    the default approach of equality is varied can be a challenging and emotional
    discussion for many clients.

    Example: Parents have an estate of $3 million and three children. They bequeath to
    a dynastic trust for each child a $1 million inheritance. That’s easy. The difficulties
    arise when the parents have children with very disparate needs; health issues or
    different wealth levels, for example. What if one child is a Wall Street tycoon and
    another a struggling school teacher, recently divorced and struggling to make ends
    meet? Should the same equal distribution be used? Perhaps in a different scenario,
    one child has a chronic medical condition that will result in truncating her career at
    age 45 and is struggling to face costly medical bills. Is equal really fair? A dramatic
    difference in the financial circumstances of one sibling versus another sibling may
    justify greater inheritance for

    Read their commentary here.

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