Asset Distribution Per Stirpes

Wading through yards of complicated legalese is on everyone’s bucket list, right? It makes estate planning so much fun. However, it won’t be complete until you include a bucket full of Latin terms to complicate your understanding of the plan. One of the most common Latin terms used in the estate planning process is the phrase per stirpes.

Asset Distribution Per Stirpes

Per stirpes means “by branch” in Latin, but is commonly understood to mean “by the bloodline.” If your estate is distributed per stirpes after your death, each branch of the family will receive an equal share of the estate.

For example, imagine that Amy has three children: Brigid, Charles, and David. At Amy’s death, all three children will receive one third of Amy’s estate – if that estate is set up to pass per stirpes. Assume now that Brigid predeceased Amy, and that Brigid has two children, Eleanor and Fergus. Now at Amy’s death, Charles and David will still receive one third of the Amy’s estate. Eleanor and Fergus will each share in what would have been Brigid’s share, so both Eleanor and Fergus will take one sixth of Amy’s estate.

If you die without an estate planning document, the State of Oklahoma has an estate plan for you. The State of Oklahoma has implemented a law that determines how your assets will be disbursed. It is found in Section 213 of Title 84 of the Oklahoma Statutes. We call this “passing by the rules of intestacy.”

In Oklahoma, the rules of intestacy include a number of different scenarios such as second marriages and children from people other than a surviving spouse. While these rules try to tackle the issues modern family structures create, they do not always distribute assets the way that you might want assets to be distributed.

For example, imagine that Lucy is married to Mark, and Lucy has no children, but she does have one brother, Nick.

Without an estate plan stating otherwise, Mark does not inherit Lucy’s entire estate at her death! According to Oklahoma law, Mark would share Lucy’s estate with Nick.

Your estate plan should be designed to accomplish your goals – per stirpes or not!

emily crain- financial planning expert

Emily Crain
Vice President

(405) 840-8401
ECrain@TrustOk.com