Does Talking with Heirs About Estate Plans Keep Families Closer?

Warren Buffet believes parents should read their wills to their children before they are signed, reports a recent article from yahoo! finance, “Warren Buffet has advice for parents on inheritance planning.” This level of transparency can prevent families from being torn apart after the parents have passed and can serve to bring children closer.

Buffet’s advice is one frequently given by estate planning attorneys to their clients: talk to your heirs about their inheritance while you are living to address issues, clear up any confusion, and avoid a lifetime of misunderstandings.

Buffet makes an annual gift to four of his family foundations every Thanksgiving, and this year, he presented a letter on his plans to distribute his wealth. Both Buffet and his late wife Susan believed extremely wealthy parents should be careful to leave their children with enough money to “do anything, but not enough that they can do nothing.”

The three Buffet heirs will not inherit his entire fortune, but they have been put in charge of donating 99.5% of it.

Buffet also has wisdom for families with more modest assets. He said there should be ongoing conversations about the estate plan as soon as children are old enough to understand the concept of an estate plan and the family’s financial situation.

Heirs should be given an opportunity to ask questions. If their suggestions are reasonable, they should be adopted, he said. All three of Buffet's children had questions. Buffet said he often took those requested changes and incorporated them into his will.

The goal is to avoid confusion about decisions while you are still living and can resolve the issues. Many families are pulled apart when parents pass, and their decisions about wealth distribution come as a surprise, creating turbulence among siblings.

While the average American inheritance is more like $46,000, according to the most recent Federal Reserve data (2016-20919), and not the $10 million left to the Buffet children from their mother’s estate, the advice is still good.

Buffet also discussed making sure his children knew early on they would always be asked for donations from sincere people and those who are not. His will contains a provision requiring all three children to approve any donations made by the foundation. They must also give an immediate and definitive response to grant seekers, allowing them to say no because one of their siblings would never agree to the request.

While most people don’t face the challenges of overseeing billions in inheritance or foundations, Buffet’s wisdom in investment and company building appears to extend to his parenting. For the rest of us, a meeting with an experienced estate planning attorney to create an estate plan is the start of a plan to distribute our wealth among heirs.

Families, especially those with many children and the means to be philanthropic, often hold regular meetings with their estate planning attorney and other advisors to discuss wills, trusts, and charitable giving to create a legacy.

Discussing estate plans with heirs is a meaningful way to foster understanding, minimize confusion, and keep families close. At The Werner Law Firm, our experienced team encourages open and proactive conversations about estate planning. Whether you're navigating complex family dynamics or ensuring your legacy aligns with your values, our experienced attorneys are here to help.

If you have any questions, schedule a free appointment with us through our online appointment page.

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Reference: yahoo! finance (Nov. 26, 2024) “Warren Buffet has advice for parents on inheritance planning”