The 50 Biggest Estate Planning Mistakes...and How to Avoid Them

OHHH, THE DREADED PERSONAL EFFECTS! Simply hearing the term ⁶ makes seasoned trust officers shudder, having seen emotions run high over items like broken tea cups and vacuum cleaners.

The will is the executor’s road map, but when it comes to personal effects, the will can be terse, or even silent, about how to distribute them. There may be a reference to a memorandum that the deceased plans to prepare sometime between the date of the will and his or her death, but often no such memorandum can be found.

As well, articles mentioned in the will may be missing or if the articles are around, there may be people who say that some items did not actually belong to the deceased. For example, if Tom’s will says that his personal effects go to his surviving spouse, Hilary, from his second marriage, and the balance of his estate to the children from the first marriage, there may be some quibbling over whether the grand piano from the children’s youth belongs as part of Hilary’s personal property or part of the residue.

In light of the anxiety and stress that are often caused by a deceased’s personal effects, a wise executor will swiftly locate and secure the personal effects and then take a measured and methodical approach to their distribution. Sometimes there is a rush to clean out the home, sort everything out, get the house sold and move on. But this can be a time when the old adage “Haste makes waste” applies, and as the executor, your job is to bring reason and order to the estate whenever possible.

After you have changed the locks on the deceased’s home, or otherwise taken steps to make sure that none of the personal property goes missing, take an inventory and review the will’s terms about personal effects. If it refers to the possibility that the deceased might have written a memorandum sometime between the date of the will and his or her death, try to track that down, although there is always a good chance that such a document was never done.

After taking these steps and speaking informally with the beneficiaries, you will start to get an idea about how to proceed. Gifts that are spelled out in the will or a memorandum are the most straightforward, but it is rare that all of the personal property will be covered. Many wills provide that the personal effects—or the remaining items after the specific gifts are made—shall be distributed among a certain group of people “as they shall agree,” with no method given for how that agreement will be reached.

We’re sure there are a lot of families like one we know where the division of Mom and Dad’s artwork and personal effects involved everyone saying, “No, you take it.” “No, no, you take it, you have always loved this painting,” and so on. But there are also plenty of situations in which tempers flare and the personal property becomes the lightning rod for years of fighting.

Trust officers and estate mediators shared with us a number of really helpful tips on working through the distribution of an estate’s personal effects, which you may find useful to consider as you wade into this aspect of estate administration:

1. Think about storing the personal effects for a while—even for three or four months. It can be a very difficult and emotional time immediately after the death and the funeral, and people may not be in the best state of mind for this particular discussion. What’s the hurry? As long as the items are safe and secure, storing the items gives everyone time to reflect on which of the deceased’s cherished personal items really matter to them, and the cost will likely be money well spent.

2. Once you have decided on a date to divide up the property, think about having a neutral third party present for the process. The beneficiaries are likely related to one another and sometimes people behave better if there is an observer or assistant from outside the family circle. If you as the executor are not a member of the family, then perhaps your presence alone is all that is needed, but if, for example, you are both the executor and one of the children, consider this option if you have the sense that a fight is brewing. Choose a person who everyone agrees is impartial and fair.

3. Decide whether the division is going to be simply by the number of items each person receives or by value. If it is by value, then use an independent appraiser to ascertain the values ahead of time. In reality, challenges over who gets what of the personal effects are rarely due to the monetary value of the articles, but if in the estate you are working on there are a number of items that people believe to be valuable, have them appraised.

4. Think about excluding spouses or partners of the beneficiaries at the time of the distribution. This may sound harsh, but we’ve heard many stories about the negative influence on the dynamics of an estate from individuals who are not beneficiaries but rather married to beneficiaries. We won’t even attempt to guess why this happens, but experience indicates that the beneficiaries work best on their own. On the other hand, this suggestion may make no sense in your particular situation if the spouses are the only people in the group who bring an element of reason! Observe the dynamics of the estate on the personal effects situation and make the best call.

5. Come up with a methodology for distributing the items and then stick with it, such as having the eldest sibling select an item first and then so on down to the youngest, and then back up to the eldest, or drawing names out of a hat and having one round of selections, then drawing names again.

6. Encourage people to agree that everyone needs to leave with at least one to three items that are really important to them, regardless of the process used. Perhaps you can all agree that after the selection process is over, everyone will participate in a bartering process à la Halloween candy: “I got a lot of sour chews and prefer chocolate peanut butter cups, so let’s trade some.” Don’t get mad if people lose their cool; if the executor stays calm and rational, other people will be more likely to act the same way.

7. If all else fails, do what corporate executors do and set a deadline for agreement and have those items that are not agreed upon by that date sent to an auction house for public auction. The irony of this approach is that often none of the feuding beneficiaries show up at the auction. This is a last-resort method and usually the beneficiaries will reach an agreement before the hundred-year-old tea set is actually shipped off.

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