“Per stirpes” is a designation for passing assets to heirs.

Legal jargon can involve a lot of Latin and also be confusing.

Legal jargon also has real implications for the lives of Americans.

It is present in government statutes, business contracts, and estate planning.

According to a recent Motley Fool article titled “What Does Per Stirpes Mean?,” a common yet confusing term in estate planning is “per stirpes.”

“Per stripes” distributes assets through branches of a family tree.

What is the purpose and meaning of this estate planning term?

The phrase “per stirpes” describes how assets will be distributed to heirs.

Specifically, it refers to how assets would be distributed if one of your heirs precedes you in death.

Translated from Latin to English, “per stirpes” means “by branch.”

If you are a visual learner, picture a tree with branches coming out from its trunk.

The trunk is the person making the last will and testament.

The primary branches coming from the bark are the selected heirs.

The stems or smaller branches connected to the primary branches are the children of the heirs named in the last will.

If a selected heir dies before the willmaker, the branch of this deceased heir remains intact.

The assets would be inherited by the heirs of this original heir following the branch of the family tree.

Only those directly descended from your heir can inherit.

The children, rather than the spouse of your original heir, would inherit the portion dedicated to the heir.

A “per stirpes” designation ensures no branch of the family tree is excluded from an inheritance and guarantees your grandchildren will inherit if an adult child heir dies.

This stands in contrast to a “per capita” designation.

“Per capita” translates to “by heads.”

If we were to use the branch analogy, a dead branch and all of the stems would be cut off.

Only the living heirs who have been named would inherit.

If an heir dies without children, there is no difference between the two distribution designations.

While many families lean toward a “per stirpes” designation, the best estate planning decisions for one family are not the same for all families.

Work with an experienced estate planning attorney to ensure your last will, revocable living trust, or beneficiary designations accomplish your wishes.

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