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Tuesday, December 13, 2011

A letter of instruction can spare your heirs great stress

I agree with the author of this post from that a letter of instruction can be a very useful tool. You can give explanations for your choices if you wish, such as explaining that one of your children received less than the others under the will because you already gave that child a down payment on  a house. Or you can express wishes for how your children or grandchildren use their inheritances.

If your will is probated, the letter of instruction is not probated because it is not part of your will. Therefore you maintain a great deal of privacy.

In the attached article - click here to read it - the author mentions leaving lists of assets and beneficiaries as one way of using a letter, but I caution you about that particular use of a letter of instruction. Be extremely careful that you don't actually use the letter to say who gets what. That's the role of your will. You don't want to accidentally revoke your will, or cause confusion by making people think that your letter is a will.

In my time on the job, I've seen many letters of instruction (also sometimes called a Memorandum to Trustees) and have talked to dozens of people who are interested in preparing them for their own families. One of the most common wishes expressed by parents is that the children left behind be taught how to handle money. Letters can address pretty much any topic you want it to address.

If you prepare a letter of instruction, you should sign it and date it. You don't need a lawyer to prepare it, though sometimes people do ask me to look them over as part of the estate planning process. You don't need witnesses.

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