Five Ways to Embrace Inclusion in Your Estate Planning

Two older adults smile as they work on paperwork together at their dining room table.

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published 9 December 2023

Every single person deserves to exercise agency over the decisions that affect their lives and loved ones. Keeping one another safe and lifting each other up is a significant element of standing in solidarity with one another. Do these ideals resonate with you?

If so, and if you’re in the process of planning your estate, you may be wondering how best to incorporate principles of inclusion, diversity, equity and accessibility, or IDEA, into your plan. Thankfully, there are a few steps you can take to make your estate plan resonate with your IDEA values. Read on for actionable guidance to create a more inclusive framework as your lasting legacy.

1. Write an estate plan to build generational wealth for your family, the causes and communities you care about.

The importance of creating a plan in the first place may seem obvious, but it’s worth noting that about two-thirds of American adults do not have an up-to-date will. For many years, and especially in certain communities, the process of estate planning has been inaccessible for various reasons, including cost, time constraints and certain laws and policies. Due to these factors, there are gaps in wealth transfer today among different populations.

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For example, according to a Consumer Reports survey, there is significant disparity in up-to-date will possession between white Americans and people of color. Between white Americans and Black Americans alone, white Americans are 16% more likely to have a will. The absence of this documentation can prevent communities from building generational wealth.

As a result of new and affordable planning resources like online tools and attorney pro bono initiatives, a number of these barriers have finally been minimized or eliminated. More individuals have been able to transfer wealth to the next generation and make important decisions that affect their lives along with the people and causes close to their heart.

Creating an up-to-date plan allows you to plan for the distribution of all of your possessions, identify a guardian for your minor children and pets and build a legacy for a cause you care about. By creating your estate plan online or with an attorney, you can take a moment to express your IDEA principles. It’s a powerful way to exercise agency over the choices that affect you, those you care about and the communities that enrich your life.

2. Make a gift to a charity that supports IDEA principles.

Do you volunteer your time to support a particular cause? Maybe you advocate to advance access to housing in your community, or you participate in efforts to combat food insecurity in your city. Creating a gift in a will or trust to an organization that supports IDEA principles is a powerful way to supercharge your impact long after you’re gone.

Organizations with an IDEA focus, like all nonprofits, depend on the generosity of their supporters to sustain their mission. You can direct your contribution to a particular purpose or program that resonates with your values. You can also designate the gift to the organization and direct funds toward its area of greatest need.

Some nonprofits also have a legacy society that consists of a group of individuals who have built a legacy with them. By making a gift in your will or trust, you may be invited to the organization’s legacy society and enjoy exclusive invitations to events and updates about their work. When you join a legacy society, you can stand in solidarity with others who share your IDEA vision.

3. Ask for a funeral memorial gift.

Did you know that you can even ask your friends and family to create a lasting legacy for the causes you care about on your behalf? By recording your funeral wishes and asking your loved ones to make a gift in your memory, you can stand in solidarity with the communities important to you even after your passing. Funeral memorial gifts are often overlooked in an estate plan, but they are a powerful way to build collective support for an organization that resonates with your values.

Just like gifts in a will or revocable trust to an organization that supports IDEA principles, these contributions can help build the society you imagine and pass down your IDEA vision to the next generation and beyond.

4. Give your beneficiaries broad limited testamentary powers of appointment.

Not only can you leave assets in a trust for your loved ones, but you can also grant them the authority to say where those assets go after their passing. This is called a testamentary power of appointment.

For example, let's say you are leaving assets to your child, Alex, making them the beneficiary. Alex has two children: Sofie, who works as a consultant for a large company, and Sam, who works as a teacher at a local elementary school. On the event of Alex’s death, they may believe providing more support to a child who has less earning potential can be a way to practice equity in their wealth transfer. As a result, Alex may choose to direct more funds to Sam as opposed to a 50/50 split.

Additionally, it’s also common to limit the class of permissible beneficiaries to the beneficiary’s spouse and children. However, you may want to consider broadening the class to include other important individuals and organizations, such as the beneficiary’s partner or a racial justice nonprofit that serves your local community. Thus, you can distribute your assets in a way that promotes equity among the people in your life and is inclusive of the organizations that put your values into action every day.

Here’s a way you can express this IDEA wish in your plan:

Instead of:

Upon the death of the Current Beneficiary before complete distribution of the trust, the remainder thereof shall be distributed to or in trust for such one or more of such Current Beneficiary's spouse and descendants in such manner and in such proportions and upon such terms, conditions and trusts as such beneficiary may appoint by their will, specifically referring to the power hereby granted.

You could write:

Upon the death of the Current Beneficiary before complete distribution of the trust, the remainder thereof shall be distributed to or in trust for such one or more of such Current Beneficiary's spouse/partner, descendants, and one or more charitable organizations that advance principles of Inclusion, Diversity, Equity, and Accessibility in such manner and in such proportions and upon such terms, conditions and trusts as such beneficiary may appoint by their will, specifically referring to the power hereby granted.

5. Create your plan with respect to your loved ones’ pronouns.

When addressing your friends and family in your plans, be sure to use the pronoun(s) they prefer. Respecting the identity of those in your life by being mindful of this critical detail is a way to be inclusive, further putting your IDEA values into practice.

If you’re unsure about someone’s pronouns, consider asking or using gender-neutral pronouns such as they/them/their. You can also champion other gender-neutral terms to describe loved ones, such as “child” instead of “son” or “daughter.”

Below is an example of how you may rewrite a wish to be more gender-inclusive.

Instead of:

I bequeath my antique doll to my granddaughter, Sally, since she always loved to play with it when she came to visit.

You could write:

I bequeath my antique doll to my grandchild, Sally, since they always loved to play with it when they came to visit.

Upholding and furthering the principles of inclusion, diversity, equity and accessibility are ways for you to stand up for what you believe. Estate planning allows for your influence to extend far beyond your own lifetime. Consider the power to create positive change in a lasting way by exploring how your estate plan can carry on your values long after your journey is complete.

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Allison L. Lee is the Attorney-at-Law, Director Trusts & Estate Content for FreeWill, a mission-based public benefit corporation that partners with nonprofits to provide a simple, intuitive and efficient online self-help platform to create wills and other estate planning documents free of cost. Through its work democratizing access to these tools, FreeWill has helped raise billions for charity. Prior to joining FreeWill, Allison spent more than a decade in private practice.