The vacation home is an asset families rarely plan for properly because they don't see it as an asset.

They see it as an ideal. The cottage, the cabin, the camp-different regions have different names-is where children learned to sail, grandchildren cannonballed off the dock, and everyone gathered around a big bright fire at night.

Those memories make inheritance planning hard as parents assume the property will simply stay in the family. It rarely does without deliberate planning and the right advisor in the room. Attorneys draft the ownership vehicle. Accountants model the tax consequences. But neither professional is positioned to quantify what each option costs each heir or to fit the vacation home into the family's broader financial plan. That's a financial advisor's job, and it should start before any document gets drafted.

Ownership struggles. Simply passing down the vacation home to offspring in a will serves as little more than a placeholder for problems that surface later. Shared ownership without clear rules turns a gift into a problem almost every time. Heirs tend to clash over recurrent issues, including:

Spending priorities: One heir wants to renovate the kitchen. Another wants to keep costs flat, and another prefers it all stay "the way Grammy liked it."

Access and usage: One heir lives close and uses the place at will. Another needs flights, car rentals, and at least a week off work to enjoy the home.

Carrying costs: Taxes, insurance, and upkeep compound these imbalances.

Decision rights: Who decides whether to renovate, rent, or sell?

Next-gen tensions. Even if a first-generation handoff goes well, the transition to second and third generations may not. By then, close siblings may be replaced by in-laws, distant cousins, and the offspring of second families. Add different incomes, different appetites for maintenance costs, and different emotional relationships to the place, and a family home can start to feel more like a timeshare than a family retreat.

In such situations it's useful to remember that equal isn't always the same as fair. I know a family whose Maine coast compound included several houses, shared collectively for generations. As the family grew, the arrangement stopped working. After frank discussions, they split ownership and reworked taxes, insurance, and improvement costs so expenses matched ownership and use. Abandoning a structure that had worked for earlier generations preserved the properties without damaging relationships.

In another family, the kids all wanted to keep the property, but their incomes diverged. The parents put the house in a trust that scaled contributions to income, while every child kept an equal stake and vote. In another, one heir got the property while siblings received other assets of comparable value.

Open conversation. Keeping a shared vacation home as a multigenerational legacy doesn't happen by accident. It requires the donor gathering all the heirs together and asking each whether they want to own the place and the responsibilities that go with it.

The conversation should make the donor's intentions explicit, so the next generation inherits the logic, not just the deed. Too often these conversations occur only after a death, leaving heirs guessing at intentions no one wrote down. That spawns resentment.

Financial advisors have a key role to play in this process. Before the transfer happens they should:

Speak with each heir to determine whether they actually want the property, costs, and obligations included;

Discuss how taxes, insurance, maintenance, and improvements will be shared, perhaps weighing usage and income rather than defaulting to an even split;

Consider establishing a trust or LLC to set voting rights, scheduling rules, and responsibility for major decisions; and

Define exits in advance-how can owners leave, how will stakes be valued, and who gets first purchase rights.

Harmoniously maintaining a shared vacation home across generations doesn't happen by accident. Families should treat the property as an asset and get the professional guidance they need, including from their financial advisor.

Helen Andreoli, CFP, is managing partner of Great Diamond Partners in Portland, Maine. Previously, she served as vice president-investments at UBS Financial Services, and as a financial advisor at Merrill Lynch and Morgan Stanley.

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