Step 12: Pep Talk to the heirs

Talking points for the kickoff of estate administration. This is best done early, (like the day after the memorial service) before any actions are taken by heirs.

As executor It's good to give a pep talk to the heirs to lay out some interests and goals of successful estate administration.

1) What Mom wanted most was that we all remain close as a functional family.
2) So administering the estate in a fair and constructive fashion is important and in keeping with her wishes. It preserves and enhances relationships in a time of stress.
3) Done right, we can use tackling this problem, as a bonding experience.
4) Done wrong, it will leave lingering animosity.
5) The will and estate documents allocate the estate in the following shares: x% to Betty and x% to Wilma....
6) Is everyone OK with that? (listen for the answers)
7) Mom worked hard to earn her money and we should respect that by administering the estate in a productive, low cost, efficient, low waste and timely manner that preserves the most for us heirs.
8) No one has a monopoly on good ideas. We should all be open to each others' suggestions as we proceed.
<p>What is done with the money that was used for auction? Is it divided equally between the heirs? This would mean someone who bid on something would get a portion of their money back, correct?</p>
<p>Our family of 4 siblings just did this and I definitely have comments. We did this while my father is still alive.</p><p>First, I highly advise that you have either the siblings or a spouse but not both. And have everyone agree on process.</p><p>Second, I suggest each sibling gets to select one object at the outset and then auction everything else.</p><p>Third, the idea of family members being nice during an auction might be something some families are capable of, not mine. My brothers bid up objects they didn't even want just for the fun of watching the rest of us lose more money. Be careful!</p>
<p>I like this idea after hearing it: A man had 3 adult children. He left instruction for one child (likely the most honest or fair one) to speak to each sibling to determine what items were most sentimental amongst his personal belongings. The residue of the estate was divided equally 3 ways; land, house, car, money, etc.</p><p>Then the one child had to divide all the personal items into 3 piles based on the information he received from his siblings and his own personal preference. Once that was done his sibling 1 and sibling 2 flipped a coin for first choice of either group 1, 2 or 3. Then sibling 2 chose a group. Finally, the child who had divided the entire lot was given the final remaining group of personal items.</p><p>I sure bet that child worked darn hard to consider everyone's wishes, split the groups evenly and fairly as best as he could because he was left with the last group available. </p><p>They were also allowed to trade or give items from their own piles to each other if it was mutually acceptable to both parties.</p><p>NICE IDEA! I really like it. I am considering using it in my own will for my 3 kids.</p>
The method I shared is similar to the final corrective trading step in the method you mentioned. My method is simpler because it skips all the prior steps of attempting to create equal value (sentimental and monetary value) piles. In my method the heirs each get to individually express how much value they place on the items they want and to have the heir who truly wants it the most, get it and compensate the others for it. All should be happy or keep bidding higher until they are happy. Nothing is left to chance. Less prep work is needed.
<p>P.S. - If there were items nobody wanted, those were first sorted out and later sold and the money was split 3 ways.</p>
<p>When it comes to estates, it is never an easy task splitting the assets within to the related family members. Sometimes the entire process could just end up in bickering or even a permanent feud. Therefore, the families involved need to ensure they hire professionals to do the job for them such as an attorney who have more experience and knowledge in this field.</p>
<p>A will can definitely help to save a lot of trouble and prevent possible family feud. For the assets and belongings, it is quite easy to allocate accordingly as they are in per piece physical form. However, for the property itself it would require the assistance of an estate agent to help sell and have the profits shared equally amongst the family members. Only in that way will it be a fair and square deal.</p>
<p>I have witnessed a few incidents of family members getting into a feud with one another over a will. It is very sad to know that the family bond is simply broken over worldly treasures. That is why it is very important to ensure that the family hires a professional lawyer to help them go through that phase fair and square. It might also include an estate agent who can help them sell the house for profits to be shared equally amongst all members.</p>
<p>I am wondering how this can be used for children of the heirs who want &quot;grandmas teapot&quot; or other items. Does the respective heir 'buy&quot; it and distribute to their children or do the children have to &quot;buy&quot; the item?</p>
It can easily work either way depending on who the estate's named heirs allow to participate in the bidding.<br><br>In your example let's assume the grandchildren are not named heirs.<br>The named heirs could choose to limit the bidders to only named heirs. (Then one could outbid the others for the teapot and give it to whomever.)<br>Or a better option is to allow more bidders into the process directly so their is more direct information (less information lag and distortion) more liquidity (more robust bidding helping to land items where they are valued.) Non heir bidders can settle up (pay money to the estate and take items home at the timing spelled out by the executor, e.g. same day or later.)
<p>Love the concept....one question - we are thinking of adding a stipulation that the more valuable pieces would require a minimum bid 75% of the actual estate or garage sale value to avoid a situation where a relatively valuable item that only one of the group wants would go for a ridiculously low bid. E.g., say a nice piece of furniture went for $1 that nobody else could take; that would severely undervalue the item and mess up the works a bit. Are we overthinking it? (hope you're still monitoring this!!) </p>
Good idea. I've heard it called &quot;Disciplining the market&quot;. You can try to pre-establish the minimum price (like 75% of the garage sale value) or you can just bid against the low bidder if you are willing to risk winning it and then having the garage sale or donating it to charity etc.
Interesting idea. I was just wondering in the case of wealth disparity, if perhaps each heir could be given equal number/value tokens or play money to bid with instead, and with everybody being on a &quot;budget&quot;, it would level the playing field.
In step 5 I mentioned that heirs do not need to make payments on the auction day for the items they win in the bidding. They can walk home with the items that day with no cash needed. However the amount of their winning bid in dollars is added to the total estate value to compensate the estate for the item leaving with the winner. Then months later at final settlement, if there were 3 equal heirs, they each get a unique amount equal to their 1/3 of the estate total dollar value minus their unique auction bill for items won. <br>I don't think tokens would work as well since an heir who didn't want items would at final settlement, end up getting just their say 1/3 of the stock portfolio plus all of the expired worthless tokens on settlement day. <br>
Real nice article. Thanks! <br>It appears that &quot;estate bucks&quot; are based upon the amount of total known CASH assets only, since the value of the entire estate has yet to be determined when this takes place. Knowing the amount of &quot;estate bucks&quot; available prevents over-extending beyond what the estate is worth during this process. Heirs could supplement with their own cash when &quot;estate bucks&quot; run out I suppose. <br>IF only &quot;estate bucks&quot; are allowed to be used in the bidding (and non-heir bidding with cash is restricted, for instance to items not bid upon by heirs), then a wealthy heir would have the same purchasing power as all the other heirs (at least until the &quot;estate bucks&quot; ran out). <br>I've sent this article to my sister for her comments, thinking (as future executor of our father's estate) it is not too early to begin gaining consensus before the need arises. <br>Thanks again for the thoughtful piece.
I'm glad you are seeing the merits. I think the useful consensus is from the estate trustee (e.g. Your father if it is his estate). His consensus helps minimize the volume of sub optimally distributed items made as one-off promises or misunderstandings between dad and individual heirs meeting with him one by one. The estate buck bidding technique only optimizes the distribution of the assets not assigned through other techniques. I personally believe it makes sense to maximize the volume of the estate distributed optimally and to minimize the one-off assignments of items to individuals. <br>The volume of estate bucks could be estimated as the market value of the amount of the entire estate.
In my case, my parents died with no valid will, so I was asked to divvie it up. My sister, niece and nephew wanted percentages that would have left me with 0% even though I could have taken 100%. After much thought &amp; prayer, I took 50%, abandoned 50% for my sister on the proviso she abandon 25% of what she got to each of her kids. My sister procrastinated down to the wire.<br><br>As for the belongings, I handed out colored dots -- one color for each of us. Put your sticker on what you were interested in and then later we would negotiate if something had more than one sticker on it. My sister cut the stickers into quarters and pasted them all over the place. But then she didn't have room for 1/3 of what she stuck. I should have told her to only stick what she had room for.<br><br>The remaining contents were sold to a jobber. Later, I ran across my old abacus in an &quot;antiques&quot; store in town.
Your story about the classic &quot;dots method&quot; (or request method) shows that the method's shortcoming is that it is only one-dimensional. It only shows WHO wants and item. It fails to show how important getting the item is to the person. In that method some people over-request and then dump stuff. The problem is they deprived other heirs who may have wanted the items and deprived themselves of extra money they may have enjoyed more than the item. So in the dots method there is either one winner or no winners as opposed to everybody getting the best mix of what they want.
If problems go on and on, one option is to turn everything into money. Very easy to divide equally.
<p>As the &quot;default&quot; executer of my fathers estate&nbsp;with, 6 other siblings (2 of which are disinherited)&nbsp; I found your Instructable very practical and fair!&nbsp; Thanks for the post ;)</p>
Aside from the problem when the family is already dysfunctional and do not play well with others, this might not work well when there is great economic disparity between the heirs.&nbsp; Ultimately, you are buying each others' shares from each other.&nbsp; The heir who really needs money more than anything will not want to sacrifice their share of the money left at the end to buy the items from the other heirs.&nbsp; Whereas mom might have wanted all of the heirs to get some of the sentimental items, regardless of their economic circumstances.&nbsp; So consider this when adopting this method.&nbsp; Some estates just let heirs each select an item in turns until everything everyone wants is taken, without assessing the value against each heir.&nbsp; The method in this DIY is fine only if money is equal in value to each of the heirs.<br />
<p>You bring up two problems:<br /> A) Dysfunctional family members and B) Wealth disparity<br /> <br /> A) The proposed system is meant to maximize the individual and total satisfaction/happiness of all of the heirs with the distribution of the items.&nbsp; (assuming they concede to the decedant's wish that the heairs each get a specific percentage allocation of the estate value.)&nbsp; If they dissagree with the will on the percentage, they need to&nbsp;go to court&nbsp;no matter what system you use.&nbsp; If they have trouble&nbsp;allowing the process to occur&nbsp;without an authority figure present, one could be brought in,&nbsp; If they have trouble allowing the process to occur with an authority figure present, I wonder what system would elicit their cooperation.&nbsp; (i.e. it;s not a problem of the auction system.)</p> <p>B) The system is intended to&nbsp;allow each and every heir to maximize their personal happiness and satisfaction with the distribution of&nbsp;items and money.&nbsp; In the example you raise, a money-needing&nbsp;heir may maximize everyone's happiness by accepting the money paid by item-loving heirs.&nbsp;&nbsp;Maybe the&nbsp;Decedent should stipulate&nbsp;this distribution method in the will to indicate they are comfortable with their heirs maximizing&nbsp;heir happiness.&nbsp;&nbsp;As a future decedent, I&nbsp;hope to allow my heirs to maximize their happiness&nbsp;with the distribution of items and money.&nbsp;&nbsp;Any specific bequests I make are potentially sub-optimal for the interests and circumstances of the item and the individual in the distant event of my passing.</p>
I understand your point; I would only say that the one flaw I see is the underlying assumption in this system that money is the appropriate measure of happiness for the heirs.&nbsp; When there is wealth disparity among the heirs, one very wealthy heir may&nbsp; dominate every auction because money to that heir is not necessary to achieve happiness.&nbsp; Such a wealthy heir could buy all the personalty at auction at no real &quot;happiness cost&quot; because money is not scarce for that heir; whereas other heirs may be significantly less happy having no items of sentimental value.<br /> <br /> No system is perfect.&nbsp; Your method has many good features.&nbsp; I&nbsp;am just saying that when a decedent has heirs with wide disparities in wealth, using relative monetary value as the equalizer might not fairly equalize happiness.&nbsp; In such a case, the decedent may want to allow the heirs to choose items in turn after drawing lots without regard to value - or at least allow each to select a few items - maybe even limit this class of goods to those having little monetary value but potentially high sentimental value.<br />
Yeah that's all great, you can leave all the instructions you want, but when your fellow heirs and non heirs are creeps, it never turns out.
I like it. It's fair, even, and adds some life to a very sombre time. Kudos on coming up with such a unique way of addressing a problem most of us will have to deal with at some point in our lives, even if it's for our own estates. ~adamvan2000
Mmmm the gran torinio. ;) I think this is an awesome idea... I still have another 70 - 80 years to think about what I want to do.... but still :)
pretty good!
Good Idea! That would be perfect for the division of items of monetary value. The insanity that sets in though, in regard to the sentimental stuff might just overwhelm the system.
It works for items with more sentimental value also. The person with the strongest sentimental value for the item typically out-bids the others who are happy enough to get the resulting money. In my family the bidding went way above garage sale value on the book my parents used to read to us. ("If I ran the Zoo...")
The one problem with this method is that it only works if you're dealing with sane, rational, honest people. Which doesn't always very accurately describe grieving persons. :-\ Nice idea though! I'm sure it'd work in many cases. 5/5 *s.

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