Nothing will work unless you do.
Why My Grandparents’ Home Got Torn Down
October 6, 2016
My family loves get-togethers—we find any reason to gather and eat. We credit this wonderful trait to my grandparents. They were gracious hosts with amazing culinary skills. Their home, built with my grandfather’s hands, was a sanctuary for family, friends, and welcome strangers.
My grandparents didn’t just leave legacy of memorable gatherings; they also left their home to their children, expecting regular family reunions after they were gone. My grandparents would not have it any other way!
My grandmother died in 1994, eight years after my grandfather’s death.
Their children tried their best to embrace my grandparents’ vision of maintaining the family home. But time, distance, and money wreaked havoc on implementing the plan. Our hearts sank as the house slowly fell into disrepair. It took almost 14 years before the children agreed that one sibling would buy out the other childrens’ shares of the home.
By then, however, the damage to the home was done. Now, only the land and memories remain.
I believe that if my grandparents had addressed certain questions about the house, they might have been able to protect it after their death with some thoughtful estate planning. Here are those questions:
- Who wants to keep the home?
- Who would prefer their inheritance to be cash instead?
- Who can afford to buy the home?
- How will the children handle multiple owners now? How would they handle ownership upon their own divorce or death?
- Who will pay the property taxes?
- Who will ensure upkeep?
One option might have been an estate-planning provision requiring the home be sold, with the first rights to buy given to the children. Or maybe the home could have been left to one or more children, and other assets left to other children to equalize inheritances. Maybe they could have established a trust in order to fund perpetual care of the home, and to manage generational ownership.
These considerations and others in the estate planning process might have allowed the children to preserve both their wealth and their legacy.
A significant amount of wealth is transferred through real estate. According to a 2014 study by Credit Suisse and Brandeis University’s Institute on Asset and Social Policy, the primary residence represents 31% of total assets for the top 5% of wealthy black families in the U.S. and 22% for the wealthiest white Americans. The percentage of wealth embodied in a primary residence is even greater for less well-off households.
Now it’s up to my aunts and uncles to get it right for the next generation. Will wealth be lost again or will it transfer for the benefit of their descendants? It’s a great question for the next family gathering…at a place to be determined.