Discussing present and future plans for the family cottage is crucial as family members age and grown children might have varying levels of interest in maintaining the property.
If some of your children want the cottage, and others do not, the issue may become how to equalize the estate. If the cottage will form a large part of your estate, life insurance may help fill the gap for the other children. If you are not interested in paying the insurance premiums, perhaps your children will be, if the insurance policy is the solution to keeping the property.
There can be a lot of emotions wrapped up in the family cottage. It’s important to plan how it will be passed on to the next generation before that day arrives.
If several children want the cottage, you should consider a co-ownership agreement. It sets out how the cottage will be used, who will pay for it, and who will be responsible for its upkeep. The agreement should also specify how the parties can be bought out in case of disagreement, and what happens upon the death of one of the siblings.
There can be a lot of emotions wrapped up in the family cottage. It’s important to plan how it will be passed on to the next generation before that day arrives.