By: Kristin Dzialo
As the cold settles in and we are stuck in the house
surrounded by our most precious belongings, it is the perfect time to start
thinking about our tangible personal property (i.e. that ‘stuff’ you can touch
and feel - jewelry, furniture, paintings, cars). My grandmother put post-it notes under her
important tangibles, indicating who would get what at her death. But things like her teacups and panda
collection ended up being a rotational grab bag. Although this happened to work for my
family, it is not something I would ever recommend as a planner. I have witnessed too many families fight over
tangibles after someone passes, because it is often not about the ‘thing.’ It is about the loss, and grief can alter the
family dynamic in very unexpected ways. It
is all too true that “A GOAL WITHOUT A PLAN IS JUST A WISH,”
and wishes all too often do not come true.
Extremely valuable tangibles, financial or
emotional, should be incorporated into your Will or Trust as specific
distributions. Tangibles that could
cause conflicts in the family should also be written specifically into your
plan, to avoid claims of fraud or abuse. However, for most of us, and for the majority of our tangibles, they do
not fall under such categories.
A Tangible Personal Property Memorandum is a wonderful
vehicle to simply, and legally, leave personal property to your loved
ones. It is simple to complete because
it does not have to be signed in the presence of witnesses or a notary
public. It can be changed over time,
crossed out, added to, updated, thrown away.
A signature and a date (to be able to easily identify the most-recent
version), is all that is necessary. It
also allows you to leave tangible personal property to anyone that you want –
even if the person is not a beneficiary under the rest of your plan. You may have a neighbor who really loves a
painting in your house, or a sibling that you want to leave your grandfather’s
watch to, or maybe everything is going to your kids and you want to make sure
that your daughter receives your favorite earrings (and not your son’s wife!).
FIRST, in order
to incorporate the distribution of tangible personal property into your plan,
your plan documents need to allow for it.
The Tangible Personal Property Memorandum should reference the document
it is supporting (such as your Will or Trust). If your Will or Trust is silent on the use of a Tangible Personal
Property Memorandum, then you should contact your attorney to amend the
documents to allow for its use.
SECOND, be sure
that the Tangible Personal Property memorandum references the document it
supports. Keep in mind, if you revoke
your Will or amend your trust, you may need to update your memo to reflect the
new date or document title.
THIRD, complete
the memo and add to it as time goes on.
Be as descriptive as possible. Clearly
indicate ‘what’ the property is, and ‘to whom’ you want it to go. Use full names and addresses, and avoid “my
sister” or “my son.” When describing the
property, not only describe what it is in as much detail as possible, but also
describe where in the house you keep it (if it stays put, of course). If you have multiple strands of pearls, take
a picture and attach it to the memo by reference. Cash gifts or gifts of real estate should not be included in your memo; such gifts
must be incorporated into your plan itself. Always sign and date the most-recent version
of your memo, in the event your distribution terms change or multiple memos are
found. Again, this is something you can
add to over time and change as your goals change (or as your relationships
change), so take a look at it on a regular or semi-regular basis.
FOURTH, keep the signed,
original with your estate-planning documents.
As your Trustees and Personal Representatives should already know where
you keep your important documents, it is a good time to remind them and let
them know you prepared such a memo. You
do not have to share the contents of the memo with them, but let them know you
have one. If you think there are any
items that may cause family tension, discuss it with your loved ones now. Just letting people know why you did what you
did can often give perspective and understanding. You should also send a copy to your attorney
for your file.
Don’t delay! Remember: A GOAL WITHOUT A PLAN IS JUST A WISH!
©Eckert Byrne LLC 2016. The information contained herein is for general informational purposes and is not offered as, and should not be construed as, legal advice with respect to any specific matter. This email does not establish an attorney-client relationship. You should consult with an attorney for advice regarding your individual situation.
