One of the questions that many people have when preparing an estate plan is whether their heirs need to know about the contents. The answer to this question will depend on several factors, including your family culture, age of the heirs and personal preference. There is no legal obligation to tell the details to your heirs or beneficiaries to a trust, until it is time for distributions.
Remember, at a minimum someone needs to know that you have a will or trust and where it is located, but often that will be your attorney.
Situations When Transparency is a Good Idea
Here are a few examples of when it might be wise to share your estate plan details:
Family Business – If you have a family business and the heirs are directly involved, it is a good practice to let them know how the business ownership will be structured if you, as business owner, die.
Shared Family Home – It is more common now for adult children to continue living in the family home, and they will be curious to know your estate plan and how real estate is distributed. If you plan to leave the home to them, then you can explain how that will work and be divided.
Specific Bequests – If you have unusual assets such as jewelry, art and other heirlooms, then it may be a good idea to let your heirs know that will be handled, or even they have some preference for certain items. Sometimes an heir will not want to deal with some types of property or could have a sentimental attachment to other items.
Situations Where Privacy May Be Preferable
There are also circumstances where there is really no benefit to sharing the details:
Young Children – If your only heirs are minor children then there is no reason to tell them the contents of your estate plan, as it may change over time and they probably will not understand the specifics.
Significant Charitable Donations – If you are leaving a large portion of your estate to charity, you may want to keep that private. Some heirs take it the wrong way as it seems you are giving away “their” inheritance.
Existing Discord Among Heirs – Families don’t always get along, and if some heirs have existing conflict with each other it may be best not to share how you plan to distribute your assets. This is especially true if there are differences in the estate plan in amounts or types of assets for each heir.