One of the biggest challenges for anyone administering an estate is how to distribute those unique items that often can’t be equally split. So, what should you do if given the task of dividing up a family member’s estate, including those items with sentimental significance? One family came up with a clever 5-step method for dividing up their tangible items that other families might want to also try:
Divide the Property into Three Groups.
Start by having all siblings indicate the items in which they are interested, and divide those items into three groups:
(a) Those in which no one had any interest.
(b) Those in which only one person had an interest.
(c) Those in which two or more were interested.
The items where no one has an interest can be sold or given away. Those who are fortunate to be the only sibling wanting certain items get them.
Prepare Lists of the Desired Property.
Next, prepare multiple lists of the items in which more than one sibling expressed a shared interest. Each sibling receives this list of items for review. To simplify this step, the siblings aren’t provided information on the items of no interest to anyone.
Bid for the Contested Items.
Siblings are then given 500 virtual poker chips to be used for bidding on the items of most interest. Prior to the bidding deadline, siblings should talk with one another about their intentions and possibly come to an agreement first on who will receive what items. Such consultations can help avoid two people bidding a lot of tokens for a particular item and no one bidding on another similar one.
Reveal What was Won.
This 5-step method is not like a silent auction or eBay where bidders can see what others are bidding and readjust their bids up to the deadline.
After the bids are in, let everyone know what they have won without revealing the actual bids.
Add Up the Monetary Value.
Once all the allocations are determined, add up the monetary value of the items each sibling receives. Re-adjust any estate monetary distributions to ensure that everyone comes out at the same place financially.
The family reported it can be a time-consuming process but a very fair one. This 5-step method not only relieved tensions, but it also brought this one family closer together.
Thank you Harry S. Margolis and forbes.com for this content!