Trying to divide properties between kids 'equally'

KP24

Hi all,

I am looking at sorting out my finances/properties so they can be shared out between my 4 kids after my passing. Want to do this now so it hopefully reduces the strain on them and i can be transparent with them now.

Dillemma i have is trying to be fair:

1. I have ~20 properties in my name, including both residential and commercial.
   
2. I have indications of how much they are worth now + the current rent coming in

How can i use this information to draw up some 'fair' plans....? For example, i have 2 properties, one valued higher than the other but receiving less rental income. So basing it on this, the property worth less is actually more valuable!

Any help would be much appreciated!

Thanks

Marcon

KP24 said:

Hi all,

I am looking at sorting out my finances/properties so they can be shared out between my 4 kids after my passing. Want to do this now so it hopefully reduces the strain on them and i can be transparent with them now.

Dillemma i have is trying to be fair:

1. I have ~20 properties in my name, including both residential and commercial.
   
2. I have indications of how much they are worth now + the current rent coming in

How can i use this information to draw up some 'fair' plans....? For example, i have 2 properties, one valued higher than the other but receiving less rental income. So basing it on this, the property worth less is actually more valuable!

Any help would be much appreciated!

Thanks

In the absence of a crystal ball, you probably can't project how capital and rental values will fluctuate between now and when you die. Nor (forgive me) can you be certain that all 4 children will outlive you.

Might be better to chat through with a solicitor how best to arrange things so that when you die, the children inherit equal shares of your estate, which might or might not involve the sale of some or all of your properties. Given that in your previous thread a few years ago (https://forums.moneysavingexpert.com/discussion/5680014/my-portfolio-and-future-plans-some-advice/p1) you were in the process of buying your home, and had very little cash to spare, do you actually own this extensive portfolio or is it still at the planning stage?

You might also consider posting your question here rather than in the pensions forum: https://forums.moneysavingexpert.com/categories/deaths-funerals-probate

MallyGirl

Do your kids want to be landlords? They might just sell them and divide the proceeds between them 

Sea_Shell

Whatever you decide, be very careful about naming properties by address, as you may no longer own any one specific property at the time of your passing.   

Who are you planning on having as your executor?   Do they know the complexity of your estate?

JGB1955

I would just leave 25% of my estate to each child.  Who knows what you will own at date of death?

Sea_Shell

JGB1955 said:

I would just leave 25% of my estate to each child.  Who knows what you will own at date of death?

Plus that would be easiest if IHT is due, which it sounds like it might with that many properties.

Otherwise whose "property" has to be sold to pay it!!

Keep_pedalling

I would suggest you simply leave your estate to be shared equally and let them sort it out rather than trying to control it beyond the grave. Sounds like IHT will be due so unless your estate has sufficient liquid assets available to pay that bill then at least some properties will need to be sold.

Thrugelmir

Is your property portfolio totally debt free? 

Marcon

Thrugelmir said:

Is your property portfolio totally debt free? 

Doubt it. OP only owned 2 BTL properties five years ago (https://forums.moneysavingexpert.com/discussion/5541924/low-deposit-but-high-monthly-income-options#latest) and other threads indicate there are mortgages involved.

TVAS

Your will should say each child 25% of my estate. You  also need a contingency if all of your children do not survive you at the date of your death.
This will mean the whole estate is liquated and divided by 4. They will receive net after 40% inheritance tax is paid. 

Or you could start selling the properties and transfer each one to a child. If you survive 7 years no tax will be due.

You need to consult a solicitor as you have a large estate.  I also think you need tax advice it may be advantageous to set u a family trust. 

I would use Smith and Williamson I have worked for many IFAs on a freelance basis and they were the only firm who were decent, honest and not greedy. They do family trusts say you were recommended by a former freelancer who worked for them in September 2019.