When creating an estate plan, people are often most concerned with passing on the “big things” like real estate, bank accounts, and vehicles. Smaller items, like family heirlooms and keepsakes, which may not have a high dollar value, frequently have the most sentimental value for our family members. However, these personal possessions are often not specifically accounted for in wills, trusts, and other estate planning documents.
It’s important that you don’t overlook this type of property in your estate plan, as the distribution of such items can become a source of intense conflict and strife for those you leave behind. In fact, if you don’t properly address family heirlooms and keepsakes in your estate plan, it can lead to long-lasting disagreements that can tear your family apart.
Little Things With Big Value
Heirlooms and keepsakes are both prized for their sentimental value, but these possessions are slightly different from one another in terms of the manner in which the items are passed on.
Heirlooms: Heirlooms are passed down among family members for generations, and the passing of heirlooms sometimes involves traditions.
Keepsakes: Keepsakes, on the other hand, are possessions that are given or kept specifically for sentimental or nostalgic reasons, and these items may only get passed on once.
Although just about any personal possession could be considered an heirloom or keepsake, some of the most common examples of these items include the following:
- Musical instruments
- Family documents (such as birth certificates, baptism records, and citizenship papers)
- Collections (such as sports memorabilia, coins, stamps, and doll collections)
Issues Raised By Passing On Heirlooms & Keepsakes
In the legal world, both heirlooms and keepsakes are considered “non-titled personal property.” Given the potential trouble the distribution of heirlooms and keepsakes can cause for your heirs, you’ll want to take extra care in seeing that these family treasures are passed on properly. And this means incorporating them into your estate plan in one way or another.
Strategies For Peacefully Distributing Heirlooms & Keepsakes
While there is no one perfect way to distribute these items in your estate plan, your primary goal should be to maintain harmony among your loved ones during an already emotional time. As with most sensitive issues, clear communication is vital to this process.
Because your family members can have vastly different values associated with certain heirlooms and keepsakes and you may have little idea about how each person feels, you should speak with each family member in advance. By talking with family members about their feelings and expectations regarding your possessions ahead of time, you will have a much better idea how to distribute these items to your loved ones with the least amount of conflict.
Additionally, you should decide ahead of time if you need to have any of your heirlooms or keepsakes appraised. In doing so, you provide your heirs with the necessary documentation to gauge the monetary value of these items. Again, the manner in which you distribute your heirlooms and keepsakes will depend largely on the items you have to pass on and your specific family situation.
That said, here are a few estate planning strategies to consider when passing on these precious possessions:
Gifting during your lifetime: Of course, you don’t have to wait until you die to pass on your heirlooms and keepsakes, and you may prefer to give away certain special items while you are still living. By doing so, you get to personally witness the joy your loved ones experience when they receive the gift, and you can also personally explain the reasons you want each person to have a particular item.
If your heirlooms and/or keepsakes have a high monetary value, you should keep gift tax issues in mind when you give them away. If you have possessions you want to give away that might trigger gift taxes, meet with us to discuss your options.
Include items in your estate plan using a personal property memorandum: As with other assets you want to pass on after your death, you should include heirlooms and keepsakes in your estate plan by adding them to your will or trust. The best way to do this is by using what’s known as a personal property memorandum.
A personal property memorandum is a separate document that is referenced in your will or living trust. The memorandum allows you to list which items you wish to leave to each individual and detail the reasons you are giving each item. In many states, if it’s properly incorporated into your will or trust, a personal property memorandum is a legally binding document.
Furthermore, unlike a will or trust, you can create and update your memorandum without a lawyer’s help. You can change your memorandum as many times as you like, just make sure you sign and date it each time to ensure authenticity. Your memorandum can be as long or short as you like, which allows you to account for even the smallest or seemingly insignificant possessions.
Most types of tangible personal property can be included in your memorandum, but it’s important to note that you cannot list certain assets in a memorandum, including titled property, such as real estate and vehicles; assets with a beneficiary designation, such as life insurance, 401(k)s, and bank accounts; or intellectual property, such as works protected by a copyrights or trademark. If you are unsure if you should include a certain possession in your personal property memorandum, consult with us.
Pass on the values and stories behind the possessions: You may want to consider making audio recordings to accompany your heirlooms and keepsakes. In this way, your loved ones not only get to hear your voice, but they will also be able to learn the stories behind the possessions, as well as the reasons why you gave each person a particular item.
Maintain an inventory of your assets: Of course, if no one can find your heirlooms and keepsakes, they aren’t going to do anybody any good. It’s vital that you create and maintain a comprehensive inventory of all of your assets, including each of your family heirlooms and keepsakes and make sure your inventory stays consistently updated throughout your lifetime.
Keep The Peace After You Are Gone
To ensure your heirlooms and keepsakes don’t create any unnecessary conflicts among your heirs, make sure that your estate plan includes all of your assets, especially your family heirlooms and keepsakes. We can support you to ensure these precious treasures are protected and preserved as part of your Life & Legacy Plan, and that they pass to each of your loved ones in exactly the manner you would want, without causing a family feud.
This article is a service of Ashley DeBoard, a Personal Family Lawyer® Firm. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session™, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love.
The content is sourced from Personal Family Lawyer® for use by Personal Family Lawyer® firms, a source believed to be providing accurate information. This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal, or investment advice. If you are seeking legal advice specific to your needs, such advice services must be obtained on your own separate from this educational material.