Estate Planning Really Begins When You Buy Your First Major Work of Art, Furniture or Other Collectible
Most appraisals for personal property occur long after the client has made their own purchases or has inherited the property, and very often the first appraisal of personal property is only made after the death of the owner. An enlightening article by appraiser Elin Lake-Ewald for Wealth Management, of which a link to the full article via the title is below, provides a real-world example as to why estate planning really should begin when you buy your first major work of art, furniture or other collectible.
In many cases collectors do not have their collections appraised for insurance to update the replacement cost in the years after the purchase or reviewed to take into account the condition of the property as it ages. Also, as collectors begin any kind of estate planning, they often do not discuss with the family how to divided the property, let alone determine what their family's interest is in the property. Often what little information that the family recalls of most of this property after the collector has passed away is at best incomplete or incorrect. Therefore, unless the family member who originally purchased the property kept good records and the collector was on top of maintaining the property, whether physically and/or by up-to-date appraisals for insurance or estate planning, a good bit of important information will die with them. What if the children and other family members were not interested in inheriting some or all of the property, and the decedent and her or his family could have benefited from divesting of some of the property in a more favorable market? Or what if some of the art and other property is not really in the condition or by the artist that the collector believed and conveyed to the family?
In her very enlightening article - Have Clients Conduct Personal Property Review Before It’s Too Late - Lake-Ewald reviews how an estate planning assignment and appraisal revealed the reality that the client had not been able to see and provides an outline of a plan for collectors of art and other valuables to put in place starting now. Planning ahead from the beginning will smooth the way for yourself, your family members and any advisers involved in the estate and could considerably reduce the costs of appraisal, conservation or divestiture of property when the estate is to be settled.