We collect stuff throughout our lives. This “stuff” is known as our personal property. Some items are valuable, like jewelry, baseball cards, and works of art. Other items are sentimental, like grandma's tea set, old Christmas ornaments, and photographs. Regardless of the value, it is important that these items be distributed the way you want when you die. Consider the following to ensure that your wishes for your personal property are honored.
Ways to Divvy Up Your Items
If there is a specific item that you want a loved one to have, the easiest way to make an official record is to create a personal property memorandum. This document, which typically must be referenced in your existing will or trust to be effective, allows you to designate who will receive specific personal property. For instance, you can leave your gold pocket watch to your nephew, Bill Smith. When creating and updating this document, it is important that state law formalities are followed to ensure the document's validity. Also, make sure that the items you list are described with enough clarity and specificity that your personal representative or trustee will be able to easily identify them. Lastly, you want to make sure that the recipient is specifically named. It is best to refer to a specific person by the person's given name, denoting if the person is a junior or senior, instead of just as “my granddaughter” or “my son.” Because this is a separate document, you have the flexibility to change the contents without changing your entire will or trust. However, as previously mentioned, any changes made to this document must be done in accordance with your state's laws.
If you want to divide the entirety of your personal property equally among a group of beneficiaries, you can allocate an equal amount of play money to each beneficiary and hold an auction using this fake money where each beneficiary can bid on the items. This distribution scheme allows for each beneficiary to participate in the auction at an equal level, with the value of each item being determined by how much each beneficiary wants the particular item rather than by how wealthy each beneficiary is in real life, relative to the others.
Another option would be to gather all of the personal property in one location and allow each beneficiary to take turns picking an item. To encourage fairness, you could have the beneficiaries draw numbers to determine the order that they will pick. Once the numbers are drawn, the beneficiary who selected number one would choose an item first, then the beneficiary who selected number two would choose an item second, and so on. Then, when the beneficiary with the highest number has chosen an item, that same beneficiary would choose again, thereby beginning the next round with the items being chosen in reverse order, and continuing in that manner until all items have been chosen. This method works well if you have a collection of items to be divided or if most of the items are of a similar value. Using this method allows each beneficiary to receive an equal number of items but may not guarantee that each beneficiary receives an equal amount of value.