Parents often struggle with the concepts of equal, equitable, fairness and adequacy when it comes to the distribution of their assets among their children. Defining these terms will help us make the decision that most closely reflects our intention.
Adequate means the minimum amount of money needed for survival. The adequacy level has been met if our children are independent and not in need, and if we can be reasonably sure that they will not become dependent.
Equal means giving the same dollar-amount to each child. This means that we change our focus as parents from meeting the individual needs of our children to simply and equally dividing of our assets among them, without consideration of their station in life.
Equitable means having the same financial opportunity to reach a specific objective considering current personal conditions, but without regard to how those happened.
Fair means having a non-discriminatory attitude regardless of personal conditions, but with regard to how it happened. If one child chooses not to work and is still living at home, and one child works and is living independently, leaving the house to the non-working child may be equitable (each having a place to live) but not fair, and in a way, penalizes the working child.
STEPHEN B. YIM, ATTORNEY AT LAW
2054 S. Beretania St., Honolulu, HI 96826
808-524-0251 | www.stephenyimestateplanning.com