Do you discuss your estate with your future heirs?

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Jay69
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Do you discuss your estate with your future heirs?

Post by Jay69 »

In a previous post I ask, would you account for a future inheritance. The responses were about what I would expect from the group.

http://www.bogleheads.org/forum/viewtop ... 0&t=114003

Given the responses of the previous thread I wonder how many would discuss their estate plan with their future heirs and if so how would the conversation go?

The one aspect of investing I never thought I would find interesting is the behavioral side of it. The above topic maybe more of a moral/ethic question but I still find it interesting.
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larryswedroe
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Re: Do you discuss your estate with your future heirs?

Post by larryswedroe »

Great book would urge everyone to read called Preparing Your Heirs

Larry
OverTheHill
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Re: Do you discuss your estate with your future heirs?

Post by OverTheHill »

To date, I have not had any specific converstaions with my son and his wife about the details or amount of any potential inheritance. My son is generally aware that he likely will inherit a nice amount, but he has no real conception of the amount. My son would be relatively incompetent to manage anyone's finances, including his own, although he's completing a PhD from an Ivy right now. He hopes to be a tenured research professor/teaching professor at a major university, and he has a real good shot it. He's really smart, but he just doesn't pay attention to things outside his area of specific interest. On the other hand, his wife is an accountant, who now stays at home with the kids, and she plans to keep it that way. My plan is to sometime relatively soon after my son gets a solid job and they settle down to talk with them in general terms about how our money is invested and why it's invested that way. I don't plan to discuss how much money might be involved, other than to let them know it's not a minimal amount. Since we've been giving them money each year, they know we have some extra money, plus we live in a nice house in a nice resort community. I was a fairly successful attorney, while my wife was family physician, so my son has always believed that we're reasonably well off. Since he's our only child, he knows he's going to inherit whatever is left after we're gone. My wife almost certainly will live a very long time after I'm gone (I have some significant health issues), and my wife comes from a long line of women with great longevity. My primary concern is getting my son's wife ready to take care of our portfolio after I'm gone or after I'm unable to handle things. My wife has absolutely no interest in financial details, although she most certainly revolts against anyone telling her what to do. Rather than paying a trust service or wealth management group to take care of my wife, I would rather that my son's wife (assuming they stay married) take care of things, since the money saved will simply enlarge their inheritance. I also plan to let her know that the older my wife gets the more my wife should be gifting to them each year, so as to insure that we stay below the current Estate tax joint exemption level. I'm reluctant to have any of these converstions with them until after my son has gotten a real job and settles down. Of course, all this could be upset were my son and his wife to divorce, which I rate as being most doubtful, although I'm alert to any changes in that regard. My son is a very good kid, and so is his wife. I trust them both to do their best for us or my wife when the time comes, but I've been putting off the money coversation so as to hopefully not change their overall plans in life due to knowing what they might get down the road. Also, regardless of how financially secure we might be right now, I think all of us here on this Board realize that the future likely holds many unknowns and unexpected events, so there really is no way of knowing for sure whether and how much we might have for my son and his wife to inherit 30 or more years from now. Those are my ideas at this time, always subject to change.
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Re: Do you discuss your estate with your future heirs?

Post by MnD »

I showed the kids everything in Fidelity Fullview and my tax return this year so they know what our income and net worth is.
No mention of estates or inheritances yet. Their mother has live to 100 genes or her side of the family so they might be 70+ years old before getting anything. :mrgreen:
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MN Finance
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Re: Do you discuss your estate with your future heirs?

Post by MN Finance »

My kids are young, but I can speak from previous generations. I truly believe it's a great disservice if the topic is not discussed. Unwinding an estate, no matter how well planned, is difficult in an already emotional time and sorting through boxes of old papers to figure out what's going on is not an efficient experience. That said, there are kids that may be less than responsible, or sibling rivalries, etc that would clearly make the conversation different.
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Jay69
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Re: Do you discuss your estate with your future heirs?

Post by Jay69 »

OverTheHill

Nice post, many here may give you a little grief about depending on your daughter-in-law but I think you have the right idea by waiting it out a bit. I was asked the same question from my in-laws after about 15 years. I'm so glad they sat down with us, told us thier wishes, explained what they want, where most of what was where etc.

For the past 2+ years we have been taking care of my mother-in-laws needs after a stroke and I can say it was way stressfull at the start with knowing most of the information. If we were tossed into blind it really would have been fun. It still took us a good year to find our feet.

This has become something that I want do for my kids as well, matter of fact we have started some of the conversations already.
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marshotel
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Re: Do you discuss your estate with your future heirs?

Post by marshotel »

My wife's parents have discussed their estate with us in general terms. We don't have copies of the trusts, but we are aware of the basic terms. It is just her and her sister. Everyone gets along. Many things can happen and change, but we live well below our means anyway and are for the most part financially secure and on tract to retire early.
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Re: Do you discuss your estate with your future heirs?

Post by jeff1949 »

I'm afraid to. They might hire a hit man. :shock: :( :twisted:
FillorKill
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Re: Do you discuss your estate with your future heirs?

Post by FillorKill »

The primary heir is a mature adult and knows all - the lines of communication are wide-open both ways. One secondary heir is 9Y old and thinks $50 is a huge amount of money, so no, she isn't ready. The other secondary heir is 9M old and I tell her absolutely everything but she doesn't say much about it. Maybe she doesn't get it but she is a great listener. :wink:
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Jay69
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Re: Do you discuss your estate with your future heirs?

Post by Jay69 »

jeff1949 wrote:I'm afraid to. They might hire a hit man. :shock: :( :twisted:
Just tell them if you don't die of natural causes the $5mil insurance policy does not pay out. At the least it could make for a colorfull well thought out death :sharebeer
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jeff1949
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Re: Do you discuss your estate with your future heirs?

Post by jeff1949 »

Jay69 wrote:
jeff1949 wrote:I'm afraid to. They might hire a hit man. :shock: :( :twisted:
Just tell them if you don't die of natural causes the $5mil insurance policy does not pay out. At the least it could make for a colorfull well thought out death :sharebeer
No insurance policy but the estate is worth about 3 mil right now. Good suggestion and maybe I can mention that in the will? :sharebeer
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Re: Do you discuss your estate with your future heirs?

Post by floydtime »

"One day lad, all this will be yours."
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Re: Do you discuss your estate with your future heirs?

Post by Garco »

My two adult kids know approximately what our net worth is. They also know that we're about to receive a substantial inheritance (mentioned in previous thread on this subject). But we tell them a few things that help them to interpret the meaning of the money we have. (1) The topline figure in our 401k's is subject to income tax, either by us or by them if they inherit it (I am trying to convert some of this money to a Roth). (2) We may spend most of it, whether by plan or by necessity if economic or health castrophe were to strike, but we expect to have some left over which we will pass on to them. (3) They should be very happy to know that we are unlikely to depend on them for financial support in our retirement.

The two kids have different attitudes toward this. The older one is fast on his way to becoming a multi-millionaire (will probably be there by the end of 2014), and any money we might pass on is not likely to make a big difference in his lifestyle or planning. The younger one is not so far along in her career, and also has college loan debt (from graduate school). She's more interested in the possibility of getting some relief in the short run from our coming inheritance. Using some of that money, we plan to help her to liquidate that debt in the next year or so, since it's one of our highest priorities, to give them the best possible education in lieu of cash. She has been told that we intend to do this. A question that my wife and I haven't resolved is whether we should give a like amount of cash to our son, just to keep things even. But if we go overboard at this stage, it could impinge on our own lifestyle and options in retirement.
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Re: Do you discuss your estate with your future heirs?

Post by Calm Man »

OverTheHill wrote:To date, I have not had any specific converstaions with my son and his wife about the details or amount of any potential inheritance. My son is generally aware that he likely will inherit a nice amount, but he has no real conception of the amount. My son would be relatively incompetent to manage anyone's finances, including his own, although he's completing a PhD from an Ivy right now. He hopes to be a tenured research professor/teaching professor at a major university, and he has a real good shot it. He's really smart, but he just doesn't pay attention to things outside his area of specific interest. On the other hand, his wife is an accountant, who now stays at home with the kids, and she plans to keep it that way. My plan is to sometime relatively soon after my son gets a solid job and they settle down to talk with them in general terms about how our money is invested and why it's invested that way. I don't plan to discuss how much money might be involved, other than to let them know it's not a minimal amount. Since we've been giving them money each year, they know we have some extra money, plus we live in a nice house in a nice resort community. I was a fairly successful attorney, while my wife was family physician, so my son has always believed that we're reasonably well off. Since he's our only child, he knows he's going to inherit whatever is left after we're gone. My wife almost certainly will live a very long time after I'm gone (I have some significant health issues), and my wife comes from a long line of women with great longevity. My primary concern is getting my son's wife ready to take care of our portfolio after I'm gone or after I'm unable to handle things. My wife has absolutely no interest in financial details, although she most certainly revolts against anyone telling her what to do. Rather than paying a trust service or wealth management group to take care of my wife, I would rather that my son's wife (assuming they stay married) take care of things, since the money saved will simply enlarge their inheritance. I also plan to let her know that the older my wife gets the more my wife should be gifting to them each year, so as to insure that we stay below the current Estate tax joint exemption level. I'm reluctant to have any of these converstions with them until after my son has gotten a real job and settles down. Of course, all this could be upset were my son and his wife to divorce, which I rate as being most doubtful, although I'm alert to any changes in that regard. My son is a very good kid, and so is his wife. I trust them both to do their best for us or my wife when the time comes, but I've been putting off the money coversation so as to hopefully not change their overall plans in life due to knowing what they might get down the road. Also, regardless of how financially secure we might be right now, I think all of us here on this Board realize that the future likely holds many unknowns and unexpected events, so there really is no way of knowing for sure whether and how much we might have for my son and his wife to inherit 30 or more years from now. Those are my ideas at this time, always subject to change.
Over the hill, I must say you are not over the hill at all. I would strongly urge not discussing this with the wife. Marriages do end. And inadvertanetly with good intentions, you have facilitated with your paying for their expenses a situation where the wife really should be working, as your son is still a student. She obviously knows that there is money to support a lifestyle with essentially no family income and kids at home, a very rare occurrence. Knowing that she will get even more will place the burden for everything on your son (or you). The big unknown here is that marriages do end (even if not by divorce, by death) and the last thing one wants is an ex-spouse spending your money on a new spouse.
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Re: Do you discuss your estate with your future heirs?

Post by masteraleph »

I'm posting from the opposite end of this- as a future heir. I'm an only child, and the sole beneficiary (though they have some charitable wishes, but they'd prefer those be dealt with after seeing what the estate looks like in the end). They gave me a CD with copies of all of their significant documents, as well: Last Will & Testaments, Advanced Medical Directives, General Power of Attorneys, and Revocable Trust documents. My parents are named as the primaries for those things, with me being a secondary trustee/gaining power of attorney/etc. in the case of the death or incapacity of the other parent. There are also provisions to protect me from accusations of self-dealing, etc. I should note that these are copies- their lawyer has the originals.

I'll be honest- it's a huge amount of trust to be putting in someone. You're depending on them not to take advantage of you in your old age (which you might or might not be aware of), particularly if they're both in charge of your care and inheriting from the estate. It was a decision that I'm sure was made easier after dealing with my great aunt (who is no longer alive) and my grandmother (who is), both of whom spent or are spending years with dementia. They've done a good job with both, as far as I can tell- my mother's brother gave a donation in honor of my mother from his portion of their aunt's estate, in recognition of her work on it- but it made them more sensitive to dealing with both the end of life and with inheritance. My parents have substantial assets and good Long Term Care insurance, but if you've seen the chart that floats around these boards about nursing home care, you may notice that a number of people end up spending years in one, which in turn costs a ton of money. It's possible that I could inherit quite a lot of money, and by the same count, it's possible that I might be in charge of spending their assets down on them. I'd prefer the former, not only for the obvious reason but also because spending assets down on them implies quite a bit of medical spending and an overwhelming likelihood of dementia, which I'm hoping they never suffer from.

The conversations have been both frank and difficult. We've discussed investments and finances for years; while they aren't bogleheads, per se, my parents made sure that I was aware they were putting money into a Roth IRA for me while I was in high school, based on paychecks that I received. We've also discussed the continuing care of both my great aunt and grandmother, so I have a good idea of what goes on there. We talk by phone at least twice a week (not about this, in general), and have a great relationship- someone over the weekend expressed disbelief that my wife could possibly have in-laws who were the way she described my parents, since it sounded so perfect. I also have certain tendencies towards a fascination with numbers and calculations (which always perplexes my students, as I'm a history teacher), which makes it a lot easier to pay attention to these things. In our case, those conversations have happened, but I'm sure it would be much more difficult in most situations.
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Re: Do you discuss your estate with your future heirs?

Post by OverTheHill »

Calm Man wrote: I would strongly urge not discussing this with the wife. Marriages do end. And inadvertanetly with good intentions, you have facilitated with your paying for their expenses a situation where the wife really should be working, as your son is still a student. She obviously knows that there is money to support a lifestyle with essentially no family income and kids at home, a very rare occurrence. Knowing that she will get even more will place the burden for everything on your son (or you). The big unknown here is that marriages do end (even if not by divorce, by death) and the last thing one wants is an ex-spouse spending your money on a new spouse.
Using this logic, then I suppose nobody could discuss family finances with their own spouse. Every situation is different. I'm no dummy, and I didn't accumulate my wealth from being a dummy. As for my DIL knowing we might have money, she would have to be a total idiot not to know that we have a lot of money, just from coming to visit us. As for my son being a broke college student, he gets $30K a year teaching at the same Ivy League School where he's getting his PhD, and that's over and above tuition and health insurance which he also gets. The money I give them is extra, meant to improve their life, but it certainly isn't enough to live on. My DIL doesn't work. Well, my mother didn't work outside the home either, so what makes that so important. The only problem I see with the Bogglehead Board is how so many people feel competent to express opinions on subjects they know nothing about.
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Re: Do you discuss your estate with your future heirs?

Post by allocator »

I wish I had time for a more substantial reply. Though my children are quite young, when the time comes we will begin what I hope will be an ongoing discussion about finances and estate planning. My parents, who were by no means wealthy, were very open about finances and estate planning, including issues relating to guardianship for my siblings and me in the event of our parents' deaths before we reached adulthood. Their openness made these topics less overwhelming and "scary" than they might have been for us as kids, and has allowed me to approach these issues in my adult life with the care they deserve. When my mother was diagnosed with terminal illness a couple of years ago, we had a good grasp of her resources and were able to plan for her care with relative ease. I feel this was the outcome of years of open discussion.

My wife and I review our estate plan - wills, trusts, guardianship - every two years (or sooner if there is a need). This is one area of our financial lives where I feel we've got it together. When the time comes, we will bring our kids into the process in an age-appropriate way.

Good luck. And, FWIW, I would exclude the inheritance from future planning. Stay focused, work hard, live your life.
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Re: Do you discuss your estate with your future heirs?

Post by MathWizard »

To the OP,

I don't plan to discuss any inheritance with my kids, at least for a long time,
because there may not be any.

I may be coming from a different place about inheritances though. We kids paid for
my mother's funeral, so I guess there was a negative inheritance. For my kids, I hope that
my wife and I will have the financial assets so that my kids will not have to worry about us.
I am teachng them about finances, and they probably know more about that than I did at their age.

Retirement and investment are a ways off, and they have already said that they plan
to come to me for advice on investment once they are out of college and making good money.
I've spent about 14 years reading the best books I could find on investment. Hopefully that
will give them a leg up, even if I can just steer them towards good books on the subject.
Once they are more savvy with their money, or if I need to as an example, I may discuss
our finances with them.

Due to the FAFSA, they both know our income, but they do not know what our level
of wealth is beyond what is in the bank. (IRAs, 401Ks, home equity, and debt are
not reported on the FAFSA.) They probably think we are relatively poor, due to the community in
which we live, and given our house and the houses of their friends. They have never really lived anywhere
where people were really poor, even poor by US standards.
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Re: Do you discuss your estate with your future heirs?

Post by rnitz »

I intend to discuss it with my children, but only after they are old enough and far enough along in life that it (hopefully) won't negatively change their behavior. I know there are a lot of fuzzy words in that sentence (old enough, negatively change, ...) so let me give some guesses at specifics. My kids are just getting into college (and I'm in my mid-50s) so I'm hoping that by the time they are out of school, somewhere along with a career, and perhaps married w/kids, that the knowledge that they will inherit a fair amount of money someday (a few million) won't turn them into slackers. I'm guessing somewhere in their mid-30s.

I've already started the discussions on how to manage money (the boglehead way) with giving them a small vanguard account with total stock and total bond holdings. I hope to keep pushing the ideas over the years, so I'm less worried about financial management. But I am concerned that if they thought they'd have a lot of money coming they won't work as hard, won't save, and have other generally negative effects on their behavior. I think (hope?) by 30-to-40ish they'll be ready for the discussions/knowledge.
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Re: Do you discuss your estate with your future heirs?

Post by orcycle »

As someone who recently (through my wife) inherited a large amount of money plus a large number of headaches in doing last-minute planning and then 2+ years of administration, with the last-minute planning occurring while my father-in-law was ill with terminal cancer, I recommend talking about this stuff at the appropriate time.

We found out too late that his estate plan was incomplete and we wound up paying a lot more in estate taxes than necessary, and it was because he did not follow up on his attorney's directives and also did not finish the paperwork when my mother-in-law passed away. He was a bright person, my father-in-law, with many interests including investing, but he just didn't want to deal with the headache of estate planning and it hurt us.

So as I still wind down the administration issues (because my wife is not interested in it and I'm an attorney), I recognize the need for us to avoid the same mistake, but I don't want to overcompensate and share too much information too early with our kids. They're all in grade school now and my plan is to slowly educate them on general money matters and when it seems they've 'gotten it' I can start to reveal what our finances are. And when probabilities justify it due to our health, include them in our estate planning so they are not caught off guard. I suspect I may reach the same point of viewing estate planning as a headache to avoid, and I want my children to be ready if/when that time comes.

Since they're too young to date, much less marry, I haven't crossed the bridge of assessing sons-in-laws for trustworthiness, but my hope is that with a lifetime of financial training, they won't defer to their future husbands on these matters.
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Re: Do you discuss your estate with your future heirs?

Post by ddunca1944 »

My sons are in their 40's. I hope to leave them a modest inheritance (perhaps several hundred thousand each), but life is uncertain and I am aware that late life expenses can add up quickly.

My sons know where to find the documents they need. (Wills, P of A's, etc). They do not know our net worth nor financial situation. I have told them not to count on an inheritance because if I develop dementia, the cost of my care will eat up everything.
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Re: Do you discuss your estate with your future heirs?

Post by DiscoBunny1979 »

There's a Cyndi Lauper Song from the 1980s that called "Money Changes Everything". In my opinion, money can change people into doing the most outrageous things in order to get their grubby little hands on any tiny dollar. But this doesn't mean that they will shoot and kill their parents when they are in their 20s. NO, in fact, the most awful things I have witnessed are from so called "lawyers" that say they are doing xyz for their client and because they are putting in so many hours, they deserve the Lion's share of what someone has. That is robbery---especially when the same lawyer has the person signing new copies of their will or trust while they are in a nursing home trying to enjoy their final days. I have seen this. So, it's not necessarily the children one has to worry about, but ANYONE having information about your affairs.

It's interesting that my parents don't discuss their complete financial picture with their children. I think it's partially because they do think that one of us will do them in. But really, murder? The problem with children NOT knowing a parent's financial situation is that when they start having Dementia problems, like my Dad, and my Mom obviously so thin that she could drop and break her hip at any moment . . . a child that's now in their 50s should know not only the physical health, but financial strength - so that given a bad fall or the trip to the nursing home, things like medical care, insurance, medications, aren't a complete shock. Knowledge is King. Without such information, not knowing if they plan on selling their house to pay for custodial care . . . or whether they have a long-term care policy hidden in a drawer, makes me nervous. It's been told to me that their 'plans' are with their trust in a binder somewhere in the house. So, when the time comes, at the spur of the moment, I will be shuffling through papers, trying to understand their wishes after the fact, when maybe everything should be clear when they still have their faculties.

I care about them. But I've had to separate my feelings from reality. If they don't want me know about their personal affairs, fine. But that doesn't mean I have to disclose mine either. And, it doesn't mean that I need or should worry myself about helping them . . . it's not MY responsibility to take care of them in their old age because they obviously haven't made discussing financial matters a family value. But that's just it to me. If they don't want to discuss anything concerning their financial health, then I certainly couldn't plan to take care of them even if I could because I don't have any idea what that would take in terms of $$$. It means that they could need 100% percent help in funding a nursing home . . . but I don't know. I will only know when the time comes, when I start looking at that binder for details of their wishes.
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Re: Do you discuss your estate with your future heirs?

Post by LadyGeek »

This thread is now in the Personal Finance (Not Investing) forum (estate planning).
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dianna
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Re: Do you discuss your estate with your future heirs?

Post by dianna »

This has been an interesting thread. The personalities of the elders as well as the children matter tremendously in these situations.

As someone in her 40's, I have been the recipient of discussions about inheritance from my parents and my spouse's parents. In my family of origin, the discussions have always involved both parents and all of us kids. We have never been told the amount of the estate, but have been told and provided documentation (wills, directives, documentation of wishes, etc) on how assets are to be managed and distributed in the event of one or both of their incapacitations or death. Despite how difficult these discussions are to hear, I have appreciated knowing my parents' intentions and wishes, and having my siblings' ears as well so that we could have subsequent discussions. I believe it has made our family less anxious about the inevitable, and more prepared in general although we hope not to have to face this for decades.

Yet as mentioned earlier, I believe each family will need to evaluate the personalities, abilities, capacities and objectiveness within the family and decide what may be best for their situation.

Best wishes,
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Re: Do you discuss your estate with your future heirs?

Post by Professor Emeritus »

Calm Man wrote:
OverTheHill wrote:.
Over the hill, I must say you are not over the hill at all. I would strongly urge not discussing this with the wife. Marriages do end. And inadvertanetly with good intentions, you have facilitated with your paying for their expenses a situation where the wife really should be working, as your son is still a student. She obviously knows that there is money to support a lifestyle with essentially no family income and kids at home, a very rare occurrence. Knowing that she will get even more will place the burden for everything on your son (or you). The big unknown here is that marriages do end (even if not by divorce, by death) and the last thing one wants is an ex-spouse spending your money on a new spouse.
Good grief. She has "kids" plural. I assure you she is "working" You are suggesting A great way to make sure you never have grandchildren. Especially when you announce that you refuse to trust the daughter-in-law.

The answer of course is a suitable trust. Whether the daughter in law is a suitable trustee is a judgment call.
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Re: Do you discuss your estate with your future heirs?

Post by Gnirk »

Yes, and no.
One of my husband's future heirs is a compulsive shopper and gambler, and if she knew how much she may inherit.....well, it wouldn't be good. In fact, he's considering an irrevocable trust for her share of the inheritance.
His other heir is very responsible financially, and we have shared our will, my husband's estate plan, and asked him to be the alternate DPOA and executor for my husband, should i be unable to fulfill those duties. (2nd marriage).

I've shared my estate plan with both my future heirs.
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Re: Do you discuss your estate with your future heirs?

Post by zebrafish »

I think failing to discuss your estate plans with your family is one of the greatest mistakes you can make.
Last edited by zebrafish on Sun Apr 07, 2013 11:09 pm, edited 2 times in total.
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Re: Do you discuss your estate with your future heirs?

Post by hicabob »

My Dad - who has a weird sense of humor and is currently 85, has his so called "death-box" - just a metal lock-box, in which are all the relevant documents , wishes, passwords, trust info, accounts etc for he and my same age Mom. I have been taken thru this. Not a bad way to do it , albeit the name, I suppose. I have not discussed the same with my kids although they have an approximate idea of my finances.
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Frugal Al
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Re: Do you discuss your estate with your future heirs?

Post by Frugal Al »

hicabob wrote:My Dad - who has a weird sense of humor and is currently 85, has his so called "death-box" - just a metal lock-box, in which are all the relevant documents , wishes, passwords, trust info, accounts etc for he and my same age Mom.
I've thought about doing the same thing, and I'm going to put one of those windup, pressure sensitive, hand shake buzzers in the bottom of the box--got to get the last laugh.
travellight
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Re: Do you discuss your estate with your future heirs?

Post by travellight »

"My kids are just getting into college (and I'm in my mid-50s) so I'm hoping that by the time they are out of school, somewhere along with a career, and perhaps married w/kids, that the knowledge that they will inherit a fair amount of money someday (a few million) won't turn them into slackers. I'm guessing somewhere in their mid-30s.

I've already started the discussions on how to manage money (the boglehead way) with giving them a small vanguard account with total stock and total bond holdings. I hope to keep pushing the ideas over the years, so I'm less worried about financial management. But I am concerned that if they thought they'd have a lot of money coming they won't work as hard, won't save, and have other generally negative effects on their behavior. I think (hope?) by 30-to-40ish they'll be ready for the discussions/knowledge."

I think this is a key principle for me, not wanting to siphon away any drive to succeed. The question is at what age is that concern over with? He is 16 now, I am thinking around 25-30.
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backofbeyond
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Re: Do you discuss your estate with your future heirs?

Post by backofbeyond »

Reminds me of a story that Bill Cosby tells. His young son once asked if they were Rich. Bill turns to him and says, your mother and I are Rich, you own nothing. :P

Our only child is in her early teens, so no, we don't discuss our estate with her. We have mentioned to the rest of our family that if something happen to all of us, who would be our heirs, but they don't really have a clue what it's worth. Since they would only inheirt our estate if the 3 of us die, I don't feel the need to burden them with the nitty gritty.
The question isn't at what age I want to retire, it is at what income. - George Foreman
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pjstack
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Re: Do you discuss your estate with your future heirs?

Post by pjstack »

Answer: Yes.

ALSO: Burial/ cremation/ body organ donation issues. Repeat this info as often as you think it takes to sink in.
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robertalpert
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Re: Do you discuss your estate with your future heirs?

Post by robertalpert »

larryswedroe wrote:Great book would urge everyone to read called Preparing Your Heirs

Larry
Could you give more specifics? (Whose the book's author)
WHL
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Re: Do you discuss your estate with your future heirs?

Post by WHL »

I'm working through all of this with my parents now. Started a few months ago and I think it's going to take a few more months. I love them both dearly, but my dad was talked into some very bad "products" (two variable annuities and closed / private REIT funds which have been decimated) and has health issues while my mom didn't have the grasp on the finances like I thought she would have.

So, I've kind of stepped in to help right the ship and make sure they have the money to last their lifetimes. I don't need and don't want their money, so I hope they get to enjoy all of it before they go.
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BHCadet
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Re: Do you discuss your estate with your future heirs?

Post by BHCadet »

Not yet…
My oldest is a college senior and the younger one is a high school senior and will be in college next school year.
However, they do know our incomes and some of the wealth because we had to submit FAFSA and CSS Profile for scholarship consideration.
We plan to discuss our finance when they have established their careers.
Leesbro63
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Re: Do you discuss your estate with your future heirs?

Post by Leesbro63 »

My kids are 19 and 23. I recently told them this: "Kids, we are not Bill Gates but we are much better off than our lifestyle would imply. Someday you will probably receive a substantial inheritance. But a lot can happen between now and when we both (ages 50 and 53) are gone. Personal financial accidents, bad financial markets, long expensive nursing home care are just a few. Or maybe your mother will outlive me and blow it all on a boy toy. So you need to do the hustle so you can stand on your own two financial feet no matter what happens. But you also need to start paying more attention to financial matters as you mature with the knowledge that someday you may need to become a good steward of family wealth". I think at these ages these are good starting talking points. I have not started to gift, but may soon. I don't want to eliminate them from need based grad school money (they won't get undergrad money no way no how). But more importantly I don't want them to feel fat n comfortable, seeing the gifts sloshing in every year. I may set up a trust for gifting, even if its very unrestrictive. Just the idea that "it's money that's tied up" may help to prevent what I worry about. At the very least its a compromise. They'll know they're gonna get money, but also will know it's not just sitting there to subsidize lifestyle (and make them dependent). And while I recognize that a "loose" trust could, indeed, end up being a slush fund, I think the psychological message of "it's separate trust money" will help to keep their noses to the grindstone until the grindstone really gets rolling.

As they mature toward age 30-35 I'll reveal more and more, and the evolution of my estate plan and what they learn when will also depend on who they marry, grandkids, my own evolving situation etc. (another 2008, for instance). If my son turns out as well as my daughter, which he appears to be doing, more gifting and discussing will happen sooner rather than later.
Leesbro63
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Re: Do you discuss your estate with your future heirs?

Post by Leesbro63 »

pjstack wrote:Answer: Yes.

ALSO: Burial/ cremation/ body organ donation issues. Repeat this info as often as you think it takes to sink in.
Sometimes this creeps young adults out. Perhaps a good discussion ONCE, with everyone in the room, is all that is necessary. With a very concise, super easy to find "UPON MY DEATH OR INCAPACITY" instruction page that they'll know to get when the time comes.
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SnapShots
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Re: Do you discuss your estate with your future heirs?

Post by SnapShots »

DH is almost 70 and I'm 65. We have told our 40 plus children, how we want our estate divided, without giving specific dollar details because that will change as years pass. If we should live a long time, the whole deal may change. But, for now, in case of a simultaneous death, we've let them know our wishes to try and head off any sibling arguments. As well as, where documents are located and name of our attorney. Our kids get along and both are self supporting, but estates sometimes have a way of dividing families.

Unless the parent is terminally ill, up in age or there is a very large estate children can depend on getting, I don't see why there should be much discussion about inheritance with young children or young adults. Except generally telling them where documents and other special items are located should there be an unexpected death.
the best decision many times is the hardest to do
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Sheepdog
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Re: Do you discuss your estate with your future heirs?

Post by Sheepdog »

I am almost 80 and my wife 73. My sons (49 and 43) know there is a trust. They do not have a personal copy, but they know where a copy is in our house and where the original is located. They have copies of our living wills and power of attorneys. They know where our burial plots are located. They know of our organ donation requests. At least once a year when they visit, I remind them where the trust copy is. They have avoided looking at it...I guess they feel uncomfortable, so there have not been any discussions. They know which one will be the final trustee (the eldest) and the youngest is fine with that.. They know that over half the estate is going to charities and they are okay with that.. They do not know how much is in the estate, though because we haven't told them. I suspect they think it is less than it is. I am sure that when the survivor of my wife and I is determined, that discussion will be held. The will portion of the trust could be changed by the survivor (which charity will get how much) ....in fact, it is likely based on our discussions, and we are both comfortable with that.
Jim
Unless you try to do something beyond what you have already mastered you will never grow. (Ralph Waldo Emerson)
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