Cabin Succession Planning: Using Technology to Build Consensus

Margaret A. T. Cronin

Attorney

Grandchamp, Guyette & Cronin, PLLC

ggclawyers.com

Topic: Legal

For those of you who own vacation or secondary homes in Minnesota and Wisconsin, deciding whether, and how, to pass the family cabin to the next generation is a hot topic. 

Making a legacy-type gift is a strategy with many layers.  Should the gift be structured as a cabin trust or a family cabin limited liability company (LLC)?  Should the trust or LLC be created during lifetime or at death?  Who among the family members is the appropriate manager or point-person for maintaining and operating the cabin?  Will users and owners contribute financially or will an "endowment" be established for future generations?  How will spouses and in-laws be treated in the plan?  Can a member of the next generation ask to be "bought out" or "opt out"?  Can the property be subdivided or sold in the future?  Should the trust or LLC be established with maximum control or an eye toward flexibility?  

Cabin succession planning is an art rather than a science.  Families must answer these questions in their own way with their own unique circumstances in mind.  Key, however, in making decisions about the family cabin is gathering input from the next generation.  If you can build consensus among family members as to the vision, structure and implementation of the plan, family members are more likely to be committed to its success.

In my practice, I have found that technology can be a bridge-builder in terms of gleaning candid opinions from the next generation, particularly on hot-button issues.  Once these issues are identified, I create a customized survey using www.surveymonkey.com (subscriptions available free or $300 annually for all of the bells and whistles).  By taking the survey, members of multiple generations have the opportunity to provide input.  From the survey responses, it is easy to create a report showing the results.  Oftentimes, the statistics themselves are enough to help resolve the difficult issues.  For example, if 79 % of the family members feel that the cabin should be sold with the unanimous consent of adult beneficiaries, that statistic may tend to drive the ultimate decision.  Even if the family remains divided after the survey process, the senior generation cabin owners now have more detailed information as to what the next generation is grappling with and can develop a plan to address these concerns and evaluate the options.

Technology can also be tremendously helpful in establishing a transparent and collaborative framework for maintaining and operating the cabin property.  "CabinShare" is an on-line software tool that allows family members to share to-dos, budgets, calendars, messages and important documents related to the cabin (release date: January 2011 at www.ourwealthcompass.com).

Passing the cabin to the next generation is an opportunity to carry forward the spirit of family togetherness.  Yes, it takes work, but when done right, it is clearly worth the effort.  Consider using technology to make the planning and implantation of your cabin legacy gift more engaging and efficient for existing and future generations.

Margaret A. T. Cronin is an attorney with Grandchamp, Guyette & Cronin, PLLC and founder of Wealth Compass, a consulting and technology firm serving families of wealth, closely-held businesses and entrepreneurs.

2010-08-11 23:00:00 -0600