Wednesday, July 12, 2000

Avoiding inheritance hassles

Five area families settled estates smoothly, and their ideas complement the experts'

By Cindy Kranz
The Cincinnati Enquirer

        When parents die or move into nursing homes, battles among their children over personal belongings can be bitter and enduring.

(Mike Simons photo)
| ZOOM |
        Consider a California woman who lingered at her mother's grave greeting mourners only to discover her sister had raced to their mother's house to grab the china hutch and jewelry. They haven't spoken in seven years.

        That's a real-life case of Jeffrey Condon, a Santa Monica, Calif. estate lawyer.

        “It's often the least important part of the inheritance that causes the longest-lasting emotional reaction,” Mr. Condon says. “When it comes to dividing up the jewelry, silverware and household contents, people never forget it if they did not get what they thought was coming to them.”

        The good news is siblings don't have to become divided while they are dividing parents property, experts say.

        Cathleen Schappacher, 33, of Sharonville feels blessed that she and her siblings preserved their close ties through cooperation and generosity. “When I reflect on the experience of settling my mother's estate, I am reminded that the most precious gift I received from my parents was my five brothers and sisters.”         When people do alienate their brothers and sisters to get what they want, some primary reasons for it are greed, unresolved sibling rivalry and interference from in-laws, say the experts.

        Greed is a big issue, says Dan Spahr, an estate planner from Deer Park, and it's often the in-laws that create trouble.

  1. Will or living trust: List items you want each child to have in a will or living trust. Items could become public knowledge and taxable.
  2. Side letter: List what you want each child to have in a side letter that is not part of your will or living trust. Its contents will likely remain private and items untaxed, but your children are not legally bound to it.
  3. Tagging: On the underside of each article you wish to designate, mark the intended child's name.
  4. Photo Journal: Take photos of each item and write the intended child's name on the back. Keep photos with the side letter.
  5. Rotating: In your inheritance plan, provide that your children cut cards. Whoever gets the highest card gets first “dibs” on any item. The child with the next highest card gets the next choice, and so on.
  Source: Jeffrey Condon, author of Beyond the Grave: The Right Way and the Wrong Way of Leaving Money to Your Children (and Others).
        One in five Americans over age 50 says an inheritance (or lack of one), has created family tension, according to a study last year by AARP Investment Program by Scudder. Of those with problems, 69 percent disagreed about money, 47 percent about jewelry or other heirlooms and 43 percent about a home.

        “These personal property disputes are always wrapped up in the family baggage,” says Mr. Condon, co-author of Beyond the Grave: The Right Way and the Wrong Way of Leaving Money to Your Children (and Others) (Harperbusiness; $15). “It's all the emotional hysteria that's been buried and recessed for years stemming from some ugly incident or things like "Mom always liked you best.'”

        Parents can help their children avoid disputes by leaving instructions with their will, experts say.

        Communication is key, says David Nelson, a downtown attorney. “If you have adult children, let them know what you're thinking and get feedback.”

        Mr. Nelson and Mr. Spahr, who present estate planning seminars in the Tristate, suggest parents make a list of whom they think should get their personal property. Then, call a family meeting and make full disclosure. They may think Bob wants the shotgun, and Mary wants the grand piano, but they may learn otherwise.

        “What parent wants their kids not talking to each other for the rest of their lives because they made a mistake on who gets the card table?” Mr. Spahr asks.

        It's ideal if parents leave instructions, but more than 60 percent of Americans die without a will. The burden then falls on families to distribute the property fairly.

        Left to their own devices, many Tristate families have been inventive in developing ways to be fair. Here's how five Tristate families kept the peace:

        • Drawing straws.

        It was an in-law who provided inspiration for smooth distribution of property after Cathryn Fridell's mother died suddenly. The 50-year-old Mount Washington woman's brother-in-law called the three siblings together in the Minnesota farmhouse where they grew up and gave them each a different color roll of tape. He suggested placing tape on the bottom of items they wanted. They agreed if any item contained two to three pieces of tape, they'd draw straws.

        “Oddly enough, the only item in the entire house that had three different colors on it was an antique Christmas decoration that my grandmother always had adorning her grand mantle,” she says. “It was a wooden team of horses pulling a load of birch logs that doubled as a candle holder. We always called it the "Yule Log.”'

        She won the draw, so she found a woodworker who duplicated the antique piece for her sister, brother and mother's sister.

        • Taking turns.

        After Marcia Galik's parents died, the five siblings decided that she and her younger sister, the only girls in the family, should enjoy their mother's special ring.

        “Now, we have an arrangement in which we trade it back and forth at Christmas, each wearing it for a year at a time,” the 44-year-old West Chester woman says. “It really works, and the transfer has become ritualistic.”

        Since Mrs. Galik's sister has the only daughter between the two of them, the daughter will inherit her grandmother's ring some day.

        • Making lists.

        An Adams County man and his siblings used a list to divide their parents' belongings at their Kouts, Ind., farm.

        “Because the three children lived up to 10 hours from home, because we had never had what one might call a "close communication pattern,' and because the one daughter-in-law loved antiques, we had the makings of trouble,” says Allen Hamann, 62, of Seaman. “However, trouble never came.”

        His sister first made a list of most household items and circulated it. They were asked to check one of four columns for each item: Must Have, Would Like, Would Take and No Way. They each were allowed to select five “Must Have” items and rank them in order of desire. They had almost no conflicts. They used the rotation method, with each person choosing one item in a round, to divide the remaining smaller items.

        Lists worked for Ms. Schappacher's family too. She credits her brother, Joe Burke of West Chester, executor of their mother's estate, for developing a fair method of dividing the property.

        He asked each of the six sibings to make a confidential list of desired items. Gifts they had given their parents would be returned to the givers if wanted. Mr. Burke divided the items among them, ensuring the approximate value was equal.

        And, he used part of the estate funds to duplicate treasured family photographs. One of his sisters divided up the originals to make sure everyone got some of them. Mr. Burke got their father's World War II mementoes and the 8mm family movies, and later gave every sibling a videotape of the movies and copies of their father's war citations.

        “Such careful consideration was given in the weighing of each request, that the gifts we received from the estate felt very appropriate and fair,” Ms. Schappacher says.

        • Bidding.

        After her father's death, Peggy Premec's mother moved to a Cleveland nursing home. The 11 children decided each could take one item that was sentimental or needed. They also had a checklist of thousands of items in the house. If they were interested in an item, they'd bid on it. If there were multiple bids, they had a bidding war, and the highest bidder won.

        Proceeds from the auction and estate sale went toward the cost of their mother's care.

        “There were no hard feelings toward each other,” the 39-year-old Villa Hills woman says, “and to this day we remain very close.”


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