You’ve probably seen this dramatic moment on TV: A lawyer holds an envelope that contains the secret contents of a will. The children of the deceased are seated, each of them hopeful but visibly anxious. They wait with bated breath as the lawyer is about to announce the inheritance for each child.

Unfortunately, this scenario isn’t far off the mark for many families. In many cases, the will is an unshared document, stored away and never discussed, which can have serious negative consequences. If the distribution of assets is seen by some heirs as unfair, there may be discord among your children or even legal battles.

Keeping the peace

What can you do to make sure this scenario doesn’t play out in your family?

The first step is preparing a list of all assets and deciding how you wish to distribute them among your heirs; this may require reviewing or updating your will. Next, communicate your plan to your children, either one on one or as a group.

It’s important to tell your children the reasoning behind your decisions, especially when children receive different assets. Sensitivity can arise if you wish to leave a greater inheritance to one child, but you can help defuse the situation by providing your rationale. For example, you might leave a larger share to a child who has special needs or is significantly younger.

Based on your children’s reactions to your plan, you may want to alter the way you distribute estate assets, especially if you think it might prevent conflict in the future.

Choose the proper representative

The person who you designate to see that your wishes are carried out also plays a key role in maintaining family harmony. This person is known as an estate representative, executor, estate trustee or liquidator, depending on the province you live in. 

Naming a family friend or relative offers the advantage of having someone who knows you and your children and understands your intent in distributing assets. But being familiar with your children can put this person in an uncomfortable position if decisions must be made involving fairness to all heirs.

To administer a more complex will or to help avoid possible conflicts, you might choose to assign an estate professional – a lawyer or trust company – to act either as sole executor or co-executor with your friend or relative.

In all cases, make sure the person you wish to name is willing and able to take on the role, and they understand the duties of an executor. Discuss your choice of executor with your children and explain the reasons for the decision. This, too, can help everyone get along – especially if you wish to name one or more of your children as executor or co-executor.

Talk to your advisor about your estate plan to help ensure harmony among your children.


How insurance can help you equalize your estate

What can you do when you have a significant asset that you can’t easily split among your children? For example, let’s say you own a family business that one child will take over and another child has no interest in. Or you have vacation property that one child envisions as her family’s weekend destination every summer but another child won’t use because he lives out of province.

In situations like these, life insurance can be a convenient and cost-effective solution. You take out a permanent life insurance policy on your own life. The policy cannot be cancelled as long as you continue to pay your premiums, so you don’t have to worry about not being able to renew if your health declines as you get older.

You name the child or children who are not inheriting the significant estate asset as beneficiary of the policy. You can choose an amount of coverage that roughly equals the projected value of the assets going to your other children, resulting in an equitable distribution among your heirs.

Your advisor can help you calculate the present and expected future value on your estate assets and structure a policy that provides the protection you need at annual premiums you can afford.