Estate Planning: Leaving a Home to Heirs While You’re Still Alive

As the American population continues to age, baby boomers heading into retirement are considering how to best pass down their most valuable asset: their home. Is it best to simply sell the home, downsize, and leave cash for beneficiaries? Or, perhaps it is better to deed the home or condo to adult children in order to avoid conflict and turmoil after your passing. If this is the case, where will you live after you gift your home? There are a number of potentially viable options for passing a home to children.

A standard method of leaving a residence behind is through a will. A drawback to using a will is that the required probate process can burden estates with significant costs and lost time. A reasonable alternative is a trust. Trust assets do not have to go through the probate process upon a settlor’s death and can be taken over by the trustee and beneficiaries with little delay. Victoria Fillet Konrad, Blueprint Financial Planning founder, notes, “If you’re looking for a smooth transition from one generation to the next, without fights and the high cost of probate, it’s best to set up a trust.”

See Kaya Laterman, Estate Planning: Leaving a Home to Heirs While You’re Still Alive, The New York Times, August 25, 2017.

Special thanks to Professor Jerry Borison, Sturm College of Law, for bringing this article to my attention.