Per stirpes is one of the ways you can choose to divide your assets among your heirs. For many, it’s the preferred way to set up asset transfer upon death.

“Per stirpes” is Latin for “by branch.” It’s used in estate planning to state that assets are to be distributed according to the decedent’s family tree.

Motley Fool’s recent article entitled, “What Does Per Stirpes Mean?” says that, in other words, if you want to leave your estate to your children, and one of them dies before you do, a per stirpes designation means that the deceased heir’s share will pass to their children (your grandchildren).

The other primary way that assets can be distributed according to the terms of a last will and testament is per capita. This means “by heads” and divides the estate only among living heirs.

Per stirpes considers only direct descendants. Therefore, if your child passes before you, their children inherit their share of your estate.

Spouses aren’t included in the distribution. Therefore, even if a child were married at his death, his spouse wouldn’t be entitled to receive a share of the estate.

A per stirpes designation in a will can be used to ensure that all your heirs (and their heirs) are considered when it comes time to divide the estate.

Therefore, if you want to make sure that your grandchildren get a portion of your property even if your children die before you do, a per stirpes designation in your will can make sure that will happen.

Of course, every estate planning situation is different, so there’s no one-size-fits-all answer. If a person dies while their heirs have no children or other direct descendants, per stirpes and per capita are effectively the same thing. However, if you plan to put a will in place, your chosen designation could have significant consequences.

In most instances, a per stirpes designation in a will ensures that your heirs and their families will get a proportional share of your estate after you die—even if your direct descendants die before you.

However, your best designation depends on your preferences and circumstances. Ask an experienced estate planning attorney for help with your estate plan.

Reference: Motley Fool (April 22, 2023) “What Does Per Stirpes Mean?”