Often overlooked in estate planning are baby boomers’ cherished porcelain dinnerware, crystal, sterling and robust antique furniture. News flash: Gen Xers and millennial children don’t want that dated stuff, which typically has low market value. But there are other ways to pass along families’ beloved decorative objects (and get tax deductions too), as certified appraiser Elizabeth Stewart, Ph.D., tells ThinkAdvisor in an interview.
Indeed, it is the objects’ economic value in the marketplace that the younger generations care about, not their sentimental value. So they have no yen to acquire fine formal china, embroidered tablecloths and Persian rugs for their homes. Instead, they crave the family stories behind such articles.
Therefore, clients should capture that history by recording videos inventorying the objects accompanied by audio relating the family history attached to them, Stewart advises. Even if offspring won’t appreciate owning the objects themselves, they’ll likely want videos representing them, she says.
Based in Santa Barbara, California, Stewart, a certified member of the Appraisers Association of America, is IRS-qualified to write noncash charitable appraisals. A consultant to estate and trust attorneys, financial advisors and firms such as U.S. Trust and Bessemer Trust, her new book is “No Thanks, Mom: The Top Ten Objects Your Kids Do Not Want (and what to do with them)” (Flandricka House Press 2017).
So how to divest heirlooms the younger generations take a pass on? Depending on the specific purpose in mind, parents can donate things with low market value to a range of different places. For example, give fine linens to a seamstress who makes wedding gowns and christening clothes. Otherwise, it’s sometimes possible to sell items like sterling flatware or fine dinnerware to replacement matching services.
Those family objects Gen Xers and Millennials do want are those with high market value, such as dual-purpose furniture and 1970s and 1980s nostalgia, like early video games and home computers. Think Atari game consoles and Commodore 64’s.
Stewart, an appraiser for 30 years and who has advised hundreds of baby boomers and their heirs, is a popular speaker at firms including Eaton Vance and Raymond James. For both, she has held private “Antique Roadshow”-style events and parties in which high-net-worth clients cart in their decorative objects for her to evaluate.
Two of her most challenging projects were advising Jonathan Winters’ heirs about the 160,000 objects the legendary comedian left upon his death in 2013 and helping a dot-com executive evaluate what came to 20 truckloads of groundbreaking computer animation software that he designed and donated to a university.
ThinkAdvisor recently interviewed Stewart, on the phone from Santa Barbara. The conversation turned to a chart she created, reproduced in her book, on “The Personality of the American Home”, which includes how the four current generations treat their possessions and living spaces. She found “Silent Generation” Moms (born:1928-1945) intent on doing their own housekeeping with Dad as the odd-jobber; baby boomers (1946-1964) putting housecleaning low on their agenda; Gen Xers (1965-1980) hiring housekeepers; and millennials (1981-1997) using floors as “catch-all” spaces. That is, they, um, do not comply with Ben Franklin’s proverb, “a place for everything and everything in its place.”
“Floors get used a lot more than furniture,” Stewart says.
Here are highlights from our conversation:
Parents asking adult children what cherished family objects they’d like to inherit and unloading those that they decline is a new idea, is it not?
Right. The tradition was, you read the will — and you get what you get.
What’s the top decorative object at which Gen Xers and Millennials turn up their noses?
Formal china because it can’t be microwaved or put in the dishwasher.
What objects do younger generations care about?
They’re most interested in the value of the objects in the marketplace. So you have to realize where the money comes from. The major money is in the Gen X and the millennial market. There’s more of them, and they have the most buying power of the four generations [others: traditionalists and baby boomers].
Doesn’t sentimental family value count?
Gen Xers and Millennials aren’t interested in sentimentality.
How do you help financial advisors help their clients?
We look at a client’s whole financial picture. People in financial houses usually look at just the dollars. We look at the whole collection of the household.
Why do you tell advisors to suggest that clients use digital technology to deal with heirship issues?
Because technology is the Gen Xer’s and millennial’s language. The client should [enlist] someone who knows how to video-record to follow them around their home and do an inventory to show the children. Not only is this valuable for the heirs, it’s valuable for insurance purposes.
Where does your input as an appraiser come in?
Some of the things kids don’t necessarily think much of would be valuable to them in the long run. So advisors often ask me, “What would you project? Will this artist or this Steuben crystal increase [in value]?” The answer is usually yes. When the advisors get a sense of the real value of objects over time, they can get the heirs interested in certain categories.
How can parents prevent offspring from fighting over objects?
In heirship appraisals about equitable distribution, I’ve seen siblings fight over an egg cup! In that sort of case, my suggestion is, again, do a video inventory of the objects, with the client telling the stories of objects: “This belonged to so and so. It’s important to me because…”
Send the video to each child and tell them that they have three months to decide what they want because after three months, the things are going into storage — and after three months in storage, they’ll be sold. “So there’s a time limit on what you guys can claim.”
How can parents avoid siblings arguing over objects bequeathed in a will?
The client should make a video and say, “Before I die and while I’m updating my trust, I want to know whose name to put on various objects.” In some cases, the children will say, “I only want the expensive stuff.” You can then ask them for their first choices and with the expensive objects, say, “I’m going to decide who’s getting what; but in the end, all the totals will be [equal].”
This entire scenario seems quite materialistic. What about parents just wanting to give kids things they’re emotionally attached to, like, an heirloom sterling silver spoon?
I would counsel to make that spoon into a narrative using video technology, speaking to that younger generation about the story behind it: “This spoon belonged to my great-grandmother. It’s part of her heritage when she came from her little village in Poland.”
Why is that a good tack?
It’s the family story that’s valuable to the next generations, not the object. Many times when I work with financial advisors, the [children] will say, “Now that we have the story, we don’t need the object.”
I recently saw an ad offering “top dollar” for 50s, 60s and 70s furniture, lighting and art. Is that just a come-on?
No. you don’t get much for 1890s furniture, but you will for sure get something for 50s, 60s and 70s furniture. Pieces from the 70s have become nostalgia and valuable. That market is hot because Gen Xers remember it for their childhood objects. Video games, like those my millennial son played with when he was 15, are highly collectible.
What other objects might millennials want?
They welcome digitalized files instead of boxes of family photos. They’re about minimalism and not having a lot of objects around. So they want things that have a dual purpose. Instead of a “gentleman’s dresser,” they might have a technology center that doubles as storage. Furniture for a specific use is pretty much obsolete. The worst is probably the buffet in the dining room. Nobody really needs a buffet — and in fact, nobody really needs a dining room.
Because it’s space-wasting?
Because the ritual of the dinner party in a special place with a service of china, silver and crystal has changed. My son, for instance, has bamboo extruded plates on the counter and a pizza box. That’s the dinner party. It’s a different attitude.
Sounds like millennials aren’t into luxurious trappings.
They have a different aesthetic about luxury. For us, luxury may mean gold-rimmed dishes. Their idea of luxury is more socially based, like a fantastic sound system they can have fun with in a social group. Their home is more a social arena. It’s not so much, “My house is my castle, and only I get to say who goes in and out.” It’s a different concept.
Surprising that younger generations don’t want their parents’ books, so you write.
It’s because the average Gen Xer and millennial will change jobs every two years and are moving house much more often than we did. So when you have to pay the movers for a library of books, you’re up to $10,000 right there.
Are they interested in inheriting doll collections?
With dolls, condition is everything. If they’re pristine, they’re worth something and can be objects of nostalgia. I just came across a John Travolta Ken [Barbie]-size doll that went for $240.
How can parents make sure their children don’t confuse valuable objects with inexpensive stuff or just junk?
The really big mistake people make is not knowing they have a Picasso original and think it’s a print. They’ll give it to Goodwill and then find out, “I just divested myself of a $20,000 painting!” So the idea is to have the parents tell what they know about the object on that video because often so many things that kids don’t want to be bothered with mistakenly go into thrift stores.
What’s one way to get a tax break through divesting?
Rules have changed with the tax law. But you can take advantage of the IRS noncash charitable contribution Form 8283 – on the www.IRS.gov website – that lets you decide your own value of objects. If the objects you donate match the mission of a particular charity, you may be able to take that against your taxes. Be aware, though, that the IRS seems to perk up when they see something valued at between $2,000 and $5,000.
What kinds of objects should a parent divest first?
Start with the most expensive things in the household because a garage sale is a waste of time. A $20,000 painting and 500 small objects for under $5 each all take about the same time to get rid of. So why not just focus on the heavy hitters?
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