As an estate planning attorney, I observe how families decide to distribute their assets among their children. I have seen two main standards used to determine the gift.
First is the standard of meeting needs and wants. As parents, we know the needs and wants of our children, and do our best to meet both of these. One child with an interest in music might need and want a guitar; another child with an interest in sports may need and want volleyball. While the dollar value of the musical instrument may not match the dollar value of the volleyball, their needs and wants would be fulfilled equally.
This standard works well while the parents are alive to observe these wants and needs. It becomes difficult and nearly impossible to meet needs and wants once the parents die and are no longer able to make those observations. They could make an educated guess in advance for their child’s future, but naturally, what a child needs or wants today will no doubt be entirely different tomorrow.
Because of this uncertainty, the standard can shift from needs and wants to equal after they die. A last will and testament or living trust can provide this equality. Many children receive these as a statement of how much their parents love them — most parents want their children to know that they are loved equally.
STEPHEN B. YIM, ATTORNEY AT LAW
2054 S. Beretania St., Honolulu, HI 96826
808-524-0251 | www.stephenyimestateplanning.com
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