As the American family becomes increasingly complex, so do parents’ wills.
The result has been a dramatic increase over the past two decades in the share of wills in which parents distribute their estate’s assets unequally among their genetic offspring and stepchildren.
New research, based on surveys of older Americans, finds that about one-third of parents today do not distribute their assets equally. The reasons range from the greater incidence of divorce and the inherent disadvantage of being a stepchild to the fact that some children naturally take on the role of caring for their aging parents. With parents now living longer and needing more care, children may receive compensation in the will for providing that care.
About 42 percent of older parents have not written a will, though it’s unclear why, according to the study.
But when there is a will, here is how complexity affects the distribution of bequests, based on the research findings:
- Some 16 percent of children live with a stepparent and often half-siblings in so-called blended families. But parents with stepchildren are considerably less likely to include all of their children than are parents who have only biological offspring. This is more true for women with stepchildren than for men with stepchildren.
- Divorced and widowed parents are even less likely to divide their assets evenly if they have stepchildren.
- For biological children, contact becomes key to whether parents have a will and also whether the children are included. Parents with little or no contact with offspring are much less likely to leave bequests to them.
- Wealth also plays a role. Wealthier parents are more likely to have a will and to include stepchildren and children with whom they have had little or no contact.
- Parents in poor health are less likely to include all of their children. This suggests that bequests are used “to elicit a long-term flow of [caregiving] services” in old age, the researchers concluded.
Equal bequests remain dominant in traditional families in which biological offspring have maintained contact with their aging parents. But in the growing ranks of complex families, the researchers found “substantial” differences in their bequests.
11 Most Read IRIS Articles of the Week!
Why Secure Passwords Matter and How to Create Them
10 Ways to Celebrate International Women’s Day
Becoming a Great Podcast Host with Celeste Headlee
New Guiding Principles for Opportunity Zone Investors
Leaders: Do You Challenge Your Status Quo?
9 Marketing Trends That Will Dominate This Year
How To Keep Envy From Destroying Your Workplace
6 Tips to Help Your Journey to Retirement
Who Do You Sell to First
Forward-Looking Investing2 days ago
Moat Investing: Powered by Morningstar
Market Strategist2 days ago
We Are Not Convinced the Market Storm Has Completely Passed
Development2 days ago
Advisors: How To Answer “What Do You Do?”
Markets2 days ago
Higher Mortgage Rates, Student Loans and Nike
Equities3 days ago
7 Stocks That Pay the Largest Dividends of All That Trade on Nasdaq – Or Do They?
Advisor3 days ago
The Wizards of Wall Street vs. The Selbees from Michigan
Markets4 days ago
The Chameleons Are on the Run
Compliance4 days ago
Regulators Focusing on How Firms Identify, Monitor and Test Custody Scenarios With Client Assets