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Open communication is vital when writing a will.

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Estate planning is a potential minefield for wealthy families, with more at stake than arguing over mom's Baccarat champagne flutes. When millions are involved, planning is more difficult and complex. To avoid family fights down the road, a properly structured customized plan is essential, and for that you'll need a consultant.

"Our role is to educate the client around their decisions," says Anthony Maiorino, head of wealth management services at RBC, a team of 157 professionals across Canada, including 21 will and estate consultants who this year alone will do close to 4,500 high net worth client interactions. "We work with the family to try and understand their objectives, what's important to them from a succession perspective and how they view the idea of 'equal and fair,' because equal is not always fair."

Getting to know the client is key. An initial meeting might take three hours simply to gather information, explains Mr. Maiorino, whose clients are all worth over $1-million. After reviewing the existing will, they'll make a recommendation plan that the person can then take to their own lawyer to get executed.

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While RBC's consultants usually work with individuals, the children are sometimes part of the conversation. Typically, issues arise when family members haven't had a discussion in advance of the estate planning.

The most conflicts occur when individuals have businesses where some family members are in the business and others are not, and the business represents the largest part of that family's wealth.

"We'll work with a family to ensure continuity and to make sure that things are structured in a good way," says Mr. Maiorino. "If there are concerns that a person inheriting isn't able to take on the business, we have relationships with organizations who can help the client decide whether someone inherits control of the business, or simply inherits the business. Maybe the general manager who's been running it for the past 25 years steps in as CEO until the person gets up to speed. Or that person may decide that the business isn't something he or she wants to be part of long-term."

Other issues can arise when an individual has borrowed money from mom or dad. It's important that the proper documents are drawn up to register that loan, if that hasn't been done already. The parents could choose to forgive that loan on their death or make a repayment structure that pays it out of the estate value. Full disclosure of information is best, but if you can't do that, Mr. Maiorino recommends writing letters or some sort of document – not as part of the will – explaining to children why a particular decision was made.

"The foundation of great estate planning is everybody being open and honest with each other, and having that upfront communication." says Mr. Maiorino. "The more information you're able to share, the more likely it is that those individuals are going to understand what you're trying to say."

Of course, individuals can always choose to set up a foundation and channel all or some of their money to charity, but that doesn't eliminate potential family conflict. A multi-generational family often has different interests in the type of charities they want to fund, so it can be important to set up the foundation so that it allows for that kind of flexibility.

"Private foundations as a separately registered legal structure can often be very narrowly focused," says Denise Castonguay, executive director of Toronto-based Canada Gives, a charitable foundation that sets up and administers foundations for affluent individuals or corporate donors.

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"Dear old dad might have set up the foundation and been very passionate about supporting scholarships, but then he passes on and the next generation inherits the foundation. That's when we sometimes see tension, because they may be too busy or not interested in the same purpose."

One solution she advises is to set up an individual foundation for each family member so they can all can do their own thing.

"That doesn't compromise the financial strength that they've already donated, but it means they don't have to fight about it," says Ms. Castonguay. "Charitable giving should be for good things."

A lot of people view gifting to family members as the easiest way to move their estate from one generation to the next with the least amount of tax, administration and work, but there are minefields there as well.

"The biggest issue that arises around gifting is the future loss of control of the asset that's being gifted," warns Mr. Maiorino. "Typically, once the decision has been made about gifting, it's difficult or impossible to get those assets back."

Mr. Maiorino gives an example: If my 84-year-old mother makes a joint bank account with one of my siblings to allow flexibility to access those funds, technically, that sibling has ownership of those funds with my mother. Consequently, they become part of their assets, as well as my mother's assets which opens up a whole area around family law which could become an issue. Or if a mother were to say to herself, 'I'm healthy, I have all this money, I'm not going to need it' and give it to her children, and then down the road she required more complex care, those assets would not be available to her and she could find herself in a difficult spot.

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"We make sure that the person gifting money to the next generation is fully aware of the ramifications of the decisions that they make," says Mr. Maiorino. "It's the planner's job to make sure the client understands there are other ways that you can utilize those funds, avoid tax and still leave a great legacy to children, charity or whatever is important for that individual."

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