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Monday, September 28, 2009

I have to treat my adult children equally in my Will - don't I?

This is a popular misconception about the law.

If your children are adults and none of them are handicapped to the extent that they can't earn a livelihood, then no, legally you don't have to treat them equally in your Will.

Adult children without handicaps are not considered to be dependents within the meaning of Alberta law (Dependents Relief Act) for the purpose of inheriting. This means that your adult children do not have the automatic right to contest your estate if you don't leave them a share. The law says that you must financially support your dependents, who are your spouse, your minor children, and adult children with a handicap that prevents them from earning a living.

Having established that none of the adult children are handicapped, why would parents want to treat their children equally? And why would they want to treat them unequally? Although each family is unique, there are some ideas that are common to Canadian families.

One widespread idea is that if parents love their children equally, they treat them equally financially. There is an expectation that there will be an equal distribution of assets because it is customary. Adult children, regardless of age, do usually feel slighted or punished if they receive less than their siblings. They will regard the person who received more as being "the favourite". Parents don't want to create that situation among their children so they try very hard to be fair. Some will spend several hours working on ways to equalize all of their children as beneficiaries.

Sometimes I point out to parents that "equal" is not necessarily the same as "fair". Sometimes the fair thing to do is to deliberately give one child more than or less than his or her siblings. Some circumstances in which that might be appropriate are:

  • the parents have given one child a lot of financial help, such as giving the child a down payment on a house or business, when they have not given the same help to the other children
  • one child has worked for years in the family business or farm, increasing its value for everyone and foregoing opportunities elsewhere
  • one child has given a widowed parent a lot of daily help and support, such as transportation, meal preparation, banking etc, as the parent ages

If parents want to make an unequal distribution among the children but do not want anyone's feelings to be hurt, I often recommend that they put a brief statement in the Will explaining their actions. It doesn't have to be lengthy or detailed. It can be something like "I have given my daughter, Melinda, a smaller share of my estate because I have given Melinda a lot of financial help during my lifetime and I want to treat my children equally." I find this to be satisfactory to the children as they know they weren't in the doghouse, and they are relieved that nobody had been pressuring the parents to leave more to them.

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