Think Twice Before Merging Your Finances With Your Children
The market is flooded with advice books about caring for your children during their first years of life, but the advice industry is frustratingly silent about the best ways to have a healthy relationship with your children when they are adults. Books, websites, and podcasts bombard you with information about the best ways to get babies to eat, sleep, and crawl, when the short answer is that it will get done, since nature has predisposed babies to hunger, sleepiness, and curiosity. Meanwhile, it is likely that two randomly selected adults will resemble each other less in behavior than two randomly selected infants. If midnight baby carriage rides are the first act of the parenting pageant, estate planning is the final act, so where is the advice about how to involve your children in your estate plan? There is more than one way to transfer property to your children in a way that benefits both parties, and which option works best depends a lot on your children and your relationship with them. Simply merging your finances with your children, however, is an unwise move. An Orange County estate planning lawyer can help you transfer property to your children sooner rather than later in the most prudent ways possible, if that is what you choose to do.
Don’t Take the Lazy Way Out of Estate Planning
You have probably heard that the laziest thing you can do in estate planning is simply not to write a will and to let the court distribute your estate to your next of kin. Estate planning lawyers often encourage elderly people to transfer property to their younger family members while the elders are still healthy enough to enjoy seeing the fruits of their generosity, but you should not do this in a lazy way.
You might be thinking that the simplest way to ensure that your children can benefit from your wealth starting now and that they can help manage your finances if you become too ill to do it yourself is simply to add your children as owners of your bank accounts and real estate properties. This is a bad idea for so many reasons. If you really are old, you will remember the Erma Bombeck quote about not lending your car to anyone to whom you have given birth; the same goes for merging finances with them. If you think it is nerve-wracking to watch your baby operate a motor vehicle, try watching your baby make financial decisions with your money. Even worse, your children will immediately become responsible for paying taxes on what is now your joint wealth.
Adding your children as owners of your assets is penny wise and pound foolish. The alternatives take more planning, but they yield better results. These alternatives include revocable trusts, power of attorney, and the annual gift tax exclusion, among others.
Contact Us Today for Help
An Orlando estate planning lawyer can help you find ways to include your children in the management and enjoyment of your assets in ways that will not create a heavy tax burden. Contact Gierach and Gierach, P.A. for help today.