Fair vs. Equal Inheritance
It’s not surprising that children don’t always like what parents decide about inheritance. It pits the concept of meritocracy against the idea of parents loving children equally.
When siblings learn the contents of their parents’ will, they often replay their childhood scenarios reliving their feelings when they judged whether their sibling received a gift that cost more, got a larger slice of cake or was allowed to stay up later.
For example, a couple has two sons. The older son is a successful doctor who worked his way through medical school. The other, a high school dropout, aimlessly moves from place to place with no plans for his future.
The parents decide to leave the older son less money and put the younger son’s share into an incentive trust. He can’t get his money if he doesn’t change his behavior.
However, the parents wonder if it’s fair to, in effect, punish the older brother for being successful while rewarding his younger brother for lack of ambition.
On the other hand, would it be fair to give them both equal shares, without restricting one from squandering his inheritance?
The bottom line is that siblings are less likely to battle it out in court if they know in advance the reasoning behind their parents’ decision.
Parents have to decide for themselves what they want to leave to their children. Some believe that their children should inherit everything. The conflict for them may be between equal or non-equal distribution, not whether their children should be the sole beneficiaries.
Others believe that they have already taken care of their children by providing a good childhood and college education. They might decide to skip a genera- tion and leave their estate to their grandchildren. Many want to direct their assets to charities they believe can make the world a better place. And still others live by the mantra reflected on their bumper stickers that read, “I’m spending my children’s inheritance.”