Creating and probating a last will and testament is rarely a simple task, but one of the most challenging aspects is the distribution of personal property, warns the article “Be clear about personal property distribution in your will” from The News-Enterprise. The nature of personal property—that it is relatively low in market value but high in sentimental value—is just part of the problem.
You’d be surprised how many families fight over a favorite ceramic dish or an inexpensive oil painting. However, those fights slow down the process of settling the estate and can create unnecessary costs.
The distribution of personal property is usually part of the residual estate, that which is left over when other assets, like a home, bank accounts, etc., have been distributed. Some families don’t even have a chance to select items, and instead find themselves in irrational bidding wars at estate sales.
This issue may be avoided by having precise language in the last will and testament or living trust about these items. First, the testator, the person who is creating the will, or the trustmaker, if using a trust, should outline the specific items they want to be given to specific people. Promised items should be listed and removed from the general pool of personal property.
Next, the testator or trustmaker, names who should be included in the distribution of remaining personal property. While some people list the same recipients of the full estate, this is not always the case, particularly if there are no children or if property is being left to charity. One option is to limit the beneficiaries of personal items to only close family members.
Third, provide clear directions for how the remaining items will be distributed. Will beneficiaries take turns in a defined order? Should the property be appraised, and values being divided equally by the executor? Be as specific as possible.
However if the person changes his or her mind, then they need to go back to the attorney to make an amendment to the will or trust. One solution to this is to use a personal property memorandum to list items for each intended beneficiary. When I do a living trust plan I provide these for all my clients. Thus it only costs a few cents for the photocopy of the form instead of legal fees.
If there are any unclaimed items, provide instructions for those as well. Do you want a collection of expensive cookware to be sent to a charitable organization? Clothing, furniture, and other items should be either donated to charity or sold at an estate sale, with the proceeds distributed between the beneficiaries.
Another way to avoid conflicts over personal property is to give away items, while you are living. Sentimental gifts are a good alternative for holiday gifts, especially for seniors on a fixed budget. This way the items are clearly out of the estate.
A warning for those who are thinking about taking the “sticky note” system: it rarely goes off without a hitch. Attaching stickers to items with the name of the person who you want to receive them is vulnerable to someone else removing the stickers. Similarly, naming one person to distribute all personal items could lead to strife between family members. There’s no legally enforceable way to ensure that they will follow your wishes.
Address the issue of personal property with your estate planning attorney. They will be able to help determine the least acrimonious means of ensuring that the people you want will end up with the things you want.
My office is fully open to discuss these and any other estate planning issues. We can schedule an in person consultation or do it virtually through Zoom.
Reference: The News-Enterprise (Sep. 29, 2020) “Be clear about personal property distribution in your will”