One of the most important things I tell my clients is that a little preparation goes a long way to preventing long-term family discord. For example, when Momma’s will leaves “everything to my four sons,” how are they to divide out Momma’s worldly goods in a way that is fair and equitable? What if one of the sons is overly assertive while one is slightly meek? Momma might have thought her boys could work together to fairly divide out her estate, but what follows could be years of Momma’s sons arguing over specific pieces of furniture, jewelry, china place settings, antiques, etc., and long term conflict. This is not what Momma wanted. Not at all.
Even if, unlike Momma, you plan on leaving almost everything to your spouse or one significant person, you may still have certain pieces of personal property you wish to leave to specific individuals. For example, maybe you want your daughter to inherit an old family Bible, and your best friend to have those Simon and Garfunkel albums. Sure, you could list out these specific gifts in your will, but you might change your mind or want to add additional items and then have to redo your will. That could get expensive.
Enter the “personal property memorandum.”
Permitted in most states, including South Carolina, a personal property memorandum can add a great deal of flexibility to your estate planning and help to avoid future family disputes. It’s simple. First, you make a list of items and indicate the people you want to inherit them, and sign it. Then, to make your memorandum legally binding, have your estate planning attorney refer to it in your will. You don’t have to sign the memorandum in front of witnesses as you do your will.
One of the best features of the personal property memoranda is that they are very simple to change. You won’t need to consult a lawyer to make alterations, even if a lawyer drew up your will and original memorandum. Making a new memorandum or just destroying one without replacing it, doesn’t affect your will.
Another advantage to making a personal property memorandum is that it can help avoid hard feelings among family members. If, like Momma, you simply leave all of your belongings to your children in equal shares, they will have to figure out how to divide everything up. That’s not always an easy job, especially if siblings have differing memories or opinions about who should inherit. But if you’re clear about who you want to inherit certain items that might be the subject of a dispute, your children will have clear directions to follow and no reason to argue.
Two important things to remember:
1. What you can and cannot leave in a personal property memorandum:
You can use a property memorandum with your will for items of tangible personal property, which includes:
- Art, jewelry, and collections
- Vehicles (in some states)
- Furniture and household items such as china and silverware
You cannot use it for real estate or for intangible property such as:
- Money, including bank accounts
- Stocks or bonds
In most states, these memoranda are not used to leave tangible business property.
2. Where there’s a Will there’s a way…but only if there’s a Will.
A personal property memorandum has no effect unless you also leave a valid will that specifically refers to it. For example, your will might say: “If I leave a writing separate from this will that disposes of some or all of my tangible personal property, whether the writing is executed before or after I execute this will, I direct that the writing be incorporated into this will and followed by my personal representative. If my personal representative cannot find any such writing within thirty days after my death, my personal representative may presume that no such writing exists and shall distribute my tangible personal property in accordance with the provisions of this will.“
If you know you need to create a personal property memorandum, I encourage you to begin making a list of the items you wish to give and the people to whom you wish to give them. Should you need an estate planning attorney to assist you in putting together your personal property memorandum and will, keep me in mind as I near the mid-January formal opening of my completely virtual legal office. I would be honored to assist you.