Adults establishing or reviewing an estate plan often focus on a few key details. Ensuring that they have made arrangements for their most valuable assets is often a priority. People worry about retirement savings accounts, real property, vehicles and businesses.
Their smaller, less valuable possessions, like home furnishings and other personal property, may not seem as important to address in an estate plan. However, those assets can become a point of intention after someone’s passing. Addressing all of a testator’s resources in an estate plan is usually the smartest strategy for those who want to avoid conflict among their beneficiaries.
Personal property can be worth thousands
Contrary to what people sometimes assume, their wardrobes, collectibles and home furnishings can be worth tens of thousands of dollars, possibly even more. Those assets may also have a degree of emotional value for the people left behind when someone dies.
People may argue over assets that did not seem valuable or important to the testator putting together a will and other estate planning documents. Even if they are careful to be thorough when addressing their most valuable possessions, the assets they don’t address could still cause issues for their family members.
The simplest solution is to establish a plan for the residuary estate. In some cases where people believe their personal property does not carry much emotional value for their loved ones, they may leave instructions for their personal representative to liquidate their residuary estate by holding an estate sale.
The personal representative can then distribute the funds generated by that sale among specific beneficiaries. It is also possible to declare one person the beneficiary who should inherit the residuary estate. Some people bequeath their personal resources to the family member they were closest with or to a loved one with fewer personal resources than other beneficiaries.
Realizing that personal property can be as important as high-value assets to address in an estate plan can help people establish arrangements that truly help their families avoid conflict after their passing. Testators often need to carefully consider the big picture rather than focusing on specific details only as they establish or review their estate planning documents.