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Wednesday, April 7, 2010

How do I make a list to give away personal belongings?

Most people probably think that estate fights are about big sums of money. Some are, of course. But many are not really about monetary value at all; they are about who gets which personal items. These items, such as jewelry, artwork, photo albums, family heirlooms and almost anything else owned by an individual, have huge sentimental value.

To avoid disputes among their children, many people like to specify that certain items are to go to specific people. For example, a woman might leave her wedding ring to her daughter. A man might leave his tools to his son. (These are by far the most popular items found in lists!)

There are two ways to do this. There are pros and cons to both ways.

The first way is to list the items and their recipients in your Will. The benefit of including them in your Will is that the list will have the same legal force as the rest of your Will. There should be no disputes, assuming your Will is valid. The downside is that if you change your mind about giving that gift, or if you sell it or dispose of it during your lifetime, your Will no longer reflects your instructions. You might end up changing your Will numerous times, which could get expensive and time-consuming.

The second way is to make a separate list that you write yourself. The benefit of writing your own list is flexibility - you can change it as often as you like. The downside is that a list like this does not have the legal effect of a Will. It is only valid as long as the residuary beneficiaries agree to it. The other downside is that people can often create a great deal of confusion by not being clear about which items they mean (such as saying "my ring" when the person owns several rings) or not being clear about which individual they intend to have the item.

It is possible to make a list before you sign your Will, then make the list part of your Will by mentioning it specifically in the Will. This is referred to as incorporating the list by reference. This gives the list legal validity, but you would lose the flexibility to change the list whenever you wanted to.

The correct name for a list like this is Memorandum of Personal Effects. When you talk with your estate planning lawyer, he or she will address the question of personal effects with you to determine your wishes and to help decide which method would be most appropriate for you.

If you want to make a Memorandum of Personal Effects of your own, follow these tips:
- do not call the document "will" or "codicil". Call it "memorandum of personal effects"
- sign and date the document using your usual signature
- you do not need witnesses
- do NOT include gifts of money
- do NOT include gifts of land, buildings, or mineral rights
- identify people using full names
- identify people using their relationship to you (e.g. "my nephew, Joey Butler")
- describe each item being given away as fully as possible, e.g. identify the artist who painted a picture you're giving away, or describe which stones are set in a ring. It's not a good idea to say, for example, "the tools I bought at Canadian Tire" because nobody but you would know where you bought them.

If you want a form that you can use, I can provide one on request if you email me or reply to this post (I won't publish your name and contact information).

1 comment:

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