People often spend a lot of time trying to figure out how to put the family home into their estate plan. Do they just leave it to the kids in equal amounts? Do they sell the house and leave the money to the children? Do they ask the children which kids want it and which ones do not?
This can get complicated enough, but it gets even more complex when you have a second home or a vacation property to leave behind. In 2018, studies found that 4.13% of Americans between the ages of 50 and 64 had at least two homes. For those between the ages of 30 and 49, it was even higher, at 6.02%. If you're doing your estate planning, this is something that definitely could be on your radar.
Why are second homes more complicated? A few reasons include:
- They may be in another state or even in another country.
- They may be worth more than the family home.
- Some children may value them far more than others; for instance, a child who likes to travel the world may not want a vacation home at all, while a child who enjoys consistently taking the same vacation may think it is practical and relaxing.
- If you have multiple children, they have to sort out how to pay for the property, how to do upkeep and how to schedule things so that everyone can use it.
Vacation homes are great, but you can see that they take special consideration in an estate plan. Make sure you know what options you have.