Q: I own quite a bit of real estate and have a large amount of financial assets. I have already created a revocable living trust, but what do I have to do if I want my children to receive a certain amount of money each month after I die?

I also want to know what might be the tax consequences of designating the children as the beneficiaries on brokerage and bank accounts. These accounts are not in the trust.

Finally, what is the best way to avoid conflict between my children after my death? Should I decide who receives which piece of property?

A: While you could buy an annuity that would dole out a monthly allowance to your children after you’re gone, I’m not a huge fan. I think they’re expensive and complicated.

You’re best off creating a trust (and naming a trustee) who can invest the cash you’re leaving behind to create a monthly steam of income for your children. The trustee could be a bank, trusted friend or financial advisor, or all three. A good estate planner can guide you through the many options you may have in deciding how best to assist your children after you die.

Minor children can’t inherit cash. You need to have the cash and financial assets in a trust with a trustee (and backup trustee) named until they become of legal age, or until you feel they are old enough to manage these resources appropriately — and not blow it all on a Ferrari.

If they’re already of legal age, then they would inherit those assets outright, unless you’ve got them in a trust that specifies what assets would pass down when they reach a certain age.

But the totals of assets like insurance policies or retirement accounts are generally included in the amount of the estate for tax purposes. The estate pays all estate taxes.

As for avoiding conflicts, the best thing to do is to talk to your children about what you have and how you are thinking about dividing the assets.

Leaving real estate to children can be tricky. It’s expensive to own and maintain — and they may not have enough income to keep the property going and they may not be living anywhere near the actual property.

It may be better to have the executor of the estate sell the property — or if one of your children wants it, he or she can purchase it out of his or her share of the inheritance.

It sounds like you have a substantial amount of assets. You’ll probably want to hire a great estate attorney who can help you put your plans into action.

Published: Nov 16, 2006