Per Capita vs Per Stirpes: What’s the Difference in a Will?

Per Stirpes vs. Per Capita: What Do These Actually Mean?

Per stirpes and per capita may sound intimidating, but they are Latin terms that describe how assets are distributed in wills if a named beneficiary isn’t alive or can’t inherit because of legal reasons.

Per stirpes keeps the shares in the deceased beneficiary’s family line, while per capita redistributes assets among the remaining eligible beneficiaries.

You primarily create a will to have control and clarity on your assets after you pass away. That’s why you name beneficiaries and decide shares of distribution. But if something unfortunate happens and the beneficiary dies before you, there might be a change in how assets are distributed.

When you create a will, you can also name contingent beneficiaries as “backup” to receive a share if a primary beneficiary dies before you. Per stirpes or per capita set the rule for who inherits a deceased beneficiary’s share; they don’t replace contingent beneficiaries, but they work alongside them to clarify how that share should flow.

Here’s what per stirpes and per capita mean:

• Per stirpes means distribution to a family branch, meaning if your child can’t inherit, your grandchildren typically inherit that child’s share. The deceased beneficiary’s share goes to their descendants.
• Per capita means the inheritance is divided by headcount among the beneficiaries who are still alive. Instead of passing a deceased beneficiary’s share down to their family line, the share is redistributed equally among the surviving members of the beneficiary group named in the will or policy. Depending on the clause (for example, a “per capita at each generation” provision), this may or may not include the deceased beneficiary’s children.

Read: How Much Does it Cost to Make a Will?

The Difference Between Per Stirpes and Per Capita: Example

If you name your child as a beneficiary but wonder what would happen if your child pre-deceased you, you can still ensure your assets stay in the family. Here is an example.

You have three adult children: Samantha, Riley and Andrew. You name each of them as beneficiaries. Sadly, two of your adult children have passed away before you. If that was the case, here’s what would happen after you’re gone. Let's assume:

• Samantha is alive, with no children.
• Riley has passed away, and has 1 child
• Andrew has passed away, and has 3 children

Choosing between per stirpes and per capita can structure the distribution in different ways. Here’s what could happen:

Per stirpes: Riley’s child gets his share, and Andrew’s children receive his share. This means Riley’s one child inherits more than each of Andrew’s three children.

Per capita: Only Samantha would inherit because under classic per capita, only surviving children inherit.

Per capita at each generation: All grandchildren inheriting at that generation split equally.

Note: This example assumes the will leaves assets “to my children.” If a will uses different per capita language, such as ‘all inheritors are in the same generation’ or ‘to my descendants, per capita,’ the split can change.

Here’s how much everyone gets:

How Per Capita vs. Per Stirpes Work in Your Estate Plan

Per stirpes and per capita are different methods of asset distribution when the primary beneficiary isn’t alive or can’t inherit the assets for some reason. Asset distribution via per capita and per stirpes typically shows up in multiple estate planning documents. Here’s where you most likely see per capita vs. per stirpes and what they control:

Wills: Your will includes per stirpes or per capita to determine how the assets are distributed if the beneficiary dies. These can help with distributing the assets down the family line or a re-split among the living beneficiaries.

Trusts: If you create a living trust during your lifetime to let your assets bypass the probate, these terms show up to handle any changes in the family over time. Mentioning a per capita or per stirpes distribution can reduce the need to rewrite your documents as your family structure changes.

Beneficiary designations: When choosing beneficiary designations, choosing between per capita and per stirpes can ensure that your assets are fairly distributed, as per your intent within the family.

Read: Primary vs Contingent Beneficiary

Quick Summary: Per Stirpes vs. Per Capita

Which One Should You Choose?

Choosing between per stirpes and per capita depends on how you want your assets to be distributed if any immediate beneficiary is no longer living. Here’s when each option makes sense:

You May Prefer to Choose Per Stirpes If:

• You want to support your grandchildren through the deceased beneficiary’s share.
• You want each succeeding family branch to have some financial support over time.
• You don’t want any addition to another beneficiary’s share, leaving your grandkids with nothing.
• You don’t want to make frequent changes to your will.

You May Prefer to Choose Per Capita If:

• You want an equal distribution for all surviving beneficiaries.
• You don't want to complicate the asset distribution by including your grandchildren.
• You don’t mind making frequent changes to your will as your family structure transforms.

Note: These are broad suggestions; what’s suitable for you may vary based on your personal situation. It might be helpful to speak with a financial advisor to see what suits you best.

Read: End of Life Planning

Common Mistakes with Per Capita vs. Per Stirpes

Per capita and per stirpes are crucial terms to ensure your asset distribution happens according to your preferences. But here are a few things to keep in mind for strategic estate planning:

• Your will controls the distribution of many assets, but don’t assume it controls everything. Some assets, like life insurance policies and retirement accounts, are often not included in your will. So, per capita or per stirpes can’t help if proper beneficiaries are not assigned. 
• For many people, planning ahead can be overwhelming. But it’s good to be practical and plan your options in case something unfortunate happens to your primary beneficiary. 
• It’s important to revisit your estate plan including your will and trust, especially after major financial or personal changes. Be clear in choosing between per stirpes and per capita. Ensure that the potential end result matches your intent.
• Understand that equal distribution may not always be fair. Fairness may be different across the beneficiaries who receive the benefits. Make sure you communicate your intent with your potential beneficiaries.