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Taking emotions out of estate planning

Agriculture.com Staff 11/03/2009 @ 2:31pm

Estate planning discussions are tough. When it comes to deciding the fate of the family farm, there's more to consider than the division of profit, assets, or taxes.

No one wants to think about losing the ability to work on the farm, not living to oversee the farm, or life without the love and support of a father, spouse, or sibling on the farm.

That's why feelings of anger, fear, and resentment often surface during conversations about the next step for the farm. Family meetings can quickly become heated and confusing when these emotions are allowed to take control.

Purdue Extension family resource management specialist Elizabeth Kiss advises farm families on how to avoid this situation and how to achieve the best possible results. She encourages them to plan their communication tactics before such a discussion.

One difficult aspect of these estate planning conversations is that parents, siblings, and other family members must come together as equals. It's obvious that everyone wants what's best for the farm, for the older generation retiring, and for the younger generation taking over.

Seeing the situation from each point of view gets tricky.

Kiss shared three strategies for communication with women at the Midwest Women in Agriculture Conference at Purdue. These strategies – direct control, indirect control, and no control – were identified by Sharon DeVanney, Purdue professor of consumer sciences and retailing.

Direct control is when the speaker, the person who called the meeting, for instance, wants to take control. Indirect control is when the speaker is flexible and will share in the decision-making. No control is when the conversation is neutral.

Depending on your family's situation and your farm operation, any one of these communication strategies may be appropriate (although Kiss says that indirect control is almost always preferred).

Before you have a difficult conversation, such as one involving estate planning, Kiss suggests that you keep the following four factors in mind:

Respectful attitude is key to the process
"How do you want to approach this conversation?" Kiss asks. "It's key to respect others' opinions and to remain emotionally neutral.

Preparation involves doing your homework
Gather information and prepare (what you'd like to say.

Consider several estate plan scenarios and the pros and cons of each, including how your plans will affect future generations.

Talk with an estate planning attorney and financial planner to get an estimate of the cost of their professional services.

"Sometimes we have to pay for advice," Kiss says. "You still have to know what your wishes are, but it's their job to help fulfill your goals."

Contact your Extension agent for assistance that might be available.

Timing is a critical issue to consider
"You might think the holidays are good because everyone is together," Kiss says. "But in reality, that could be the worst time for an estate planning discussion because it tends to be a stressful time of year."

It's never too soon to discuss estate planning. It's easier on everyone involved if decisions can be made while everyone is in good health and the farm is operating smoothly.

A calm manner is essential to a good outcome
"What do you need to do to make this conversation work?" Kiss asks. Realize that you will likely encounter resistance from at least one person involved and plan to react calmly.

When you and your family members are ready for the conversation about estate planning, consider all aspects of the estate -- from the business operations to the land, and even the valuable and sentimental contents of the house.

"You need to find out what your family members want," Kiss says.

"One of the things about untitled property -- such as Grandma's yellow pie plate -- is that you don't always know who wants what," Kiss says. "It is very hard to deal with thinking about passing along these things. They have memories and meanings for the person who has them."

Kiss stresses that estate planning is a complicated process.

"I don't mean to imply that any of these things can be solved in one conversation," she says. "It's a process."

With your farm family applying the best approach possible, the emotional process of estate planning can be made easier.

Estate planning discussions are tough. When it comes to deciding the fate of the family farm, there's more to consider than the division of profit, assets, or taxes.

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