Equal Inheritance for Children

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lernd
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Re: Equal Inheritance for Children

Post by lernd »

Duffalo714 wrote: Thu Nov 14, 2019 2:49 pm Can I place a fair comparative value on the $345,000 given to Child A during a 23-year period?
You can...but it might not be viewed as comparative or fair by the two children.

The only way to give "equal" inheritance is to split the dollar value ($15,000 or whatever total you can give) directly in half and give each child half at the same time (So annually or at whatever interval you specify). Attempting to project what $15,000/year now will be worth in the future is foolish because it will fall victim to hindsight and second-guessing. It's akin to the Powerball/Lottery dilemma of taking a lump sum payout versus the annual payments. Intelligent people can argue each side because it is an inherently personal choice. What you view as a comparative fair value may not be viewed the same way among your children and could lead to problems.

The only way to be equal is to be equal. The more assumptions and variables you introduce to achieve "equality" diminishes the chances that the decision is perceived as equitable.
averagedude
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Re: Equal Inheritance for Children

Post by averagedude »

lernd wrote: Sat Nov 16, 2019 2:40 pm
Duffalo714 wrote: Thu Nov 14, 2019 2:49 pm Can I place a fair comparative value on the $345,000 given to Child A during a 23-year period?
You can...but it might not be viewed as comparative or fair by the two children.

The only way to give "equal" inheritance is to split the dollar value ($15,000 or whatever total you can give) directly in half and give each child half at the same time (So annually or at whatever interval you specify). Attempting to project what $15,000/year now will be worth in the future is foolish because it will fall victim to hindsight and second-guessing. It's akin to the Powerball/Lottery dilemma of taking a lump sum payout versus the annual payments. Intelligent people can argue each side because it is an inherently personal choice. What you view as a comparative fair value may not be viewed the same way among your children and could lead to problems.

The only way to be equal is to be equal. The more assumptions and variables you introduce to achieve "equality" diminishes the chances that the decision is perceived as equitable.
I agree 100% with this. Interesting thread as it shows the differences of opinion that people have on the issue of fairness. I guess it really is all relative. Fairness is an issue where you can't get everyone to agree. Our politicians struggle with this when it comes to taxes. Employers struggle with this when dealing with employees. Parents struggle with this when raising multiple children. Hey, Im sure the moderators on this forum struggle with fairness from time to time. I guess it's best to try to be fair in a way that represents your belief and value systems.
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TomatoTomahto
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Re: Equal Inheritance for Children

Post by TomatoTomahto »

mrspock wrote: Thu Nov 14, 2019 9:48 pm Transparency is always best IMO. If your kids are reasonable, kind hearted and see the ways the universe has conspired to stack the deck in their favor (health, addiction, intelligence, grit etc) they should understand or at least rationalize the decision.
I’m glad that my kids are kindhearted. In the event that they weren’t, and didn’t understand our choices, I’d use a variant of the “one cuts, the other chooses” strategy for fairness in gerrymandering and cake allotment. It’s only a thought experiment, but it’s one which has worked for me as a parent when a child was envious of a classmate: I ask them whether they’d be willing to trade lives with the other. Don’t ask me what I’d say if they answered “yes;” it hasn’t happened, so I don’t know.

I’m hoping that, by the time we die, the slower to mature will have caught up.
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capran
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Re: Equal Inheritance for Children

Post by capran »

Seems like the first page had a lot of good considerations re: transparency. I totally agree if someone is disabled merits additional consideration, but I sure like the idea of including both in the discussion. You may want to consider setting up a trust for the bipolar child. It is a serious mental illness that often results in severe inability to manage ones funds. Should they come into a large sum of money, it could be gone in a heartbeat. (I worked in Mental Health for 8 years in addition to my 29 years as a counselor and therapist, and worked with serious disorders such as Bipolar and Schizophrenia.)
muddlehead
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Re: Equal Inheritance for Children

Post by muddlehead »

Didn't read every response. Someone said "can of worms" to this scenario in page 1. Concur. Put me in that camp. I would not go through with the plan of giving child A 15k for 23 years.
Arbol
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Re: Equal Inheritance for Children

Post by Arbol »

Fair is subjective. Equal shares by giving to only one child for 23 years with an offset is equally subjective since no one can put a price on future return, inflation, and lost opportunities.

I would take the $15,000 for 23 years if the offset was 2% a year. In my hands now is way better than a potential shortfall in the future.

This is like splitting the baby. There is no good way to do it. Everything depends on how the siblings get along. Resentment can be slow boiling.

Unless you give equally to both now, there is no way to give equally when one person gets money first for 23 years.
Gnirk
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Re: Equal Inheritance for Children

Post by Gnirk »

capran wrote: Sat Nov 16, 2019 8:16 pm Seems like the first page had a lot of good considerations re: transparency. I totally agree if someone is disabled merits additional consideration, but I sure like the idea of including both in the discussion. You may want to consider setting up a trust for the bipolar child. It is a serious mental illness that often results in severe inability to manage ones funds. Should they come into a large sum of money, it could be gone in a heartbeat. (I worked in Mental Health for 8 years in addition to my 29 years as a counselor and therapist, and worked with serious disorders such as Bipolar and Schizophrenia.)
I will definitely look into that, thank you.
jerryk68
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Re: Equal Inheritance for Children

Post by jerryk68 »

Duffalo714 wrote: Thu Nov 14, 2019 2:49 pm How to calculate equal inheritance for children? Does anyone know a calculation for the following? I have two children, Child A and Child B. I want to give them the same monetary inheritance. I want to give Child A, who needs the money now, $15,000 a year, an advance on her inheritance, beginning in 2020 for 23 years, my life expectancy. This totals $345,000. Child B is fine financially, plus I can’t afford to give each child $15,000 a year. In my estate plan, I want to make sure both children receive the same total monetary inheritance. Can I place a fair comparative value on the $345,000 given to Child A during a 23-year period? And, therefore, subtract that amount from Child A’s future inheritance, thus ensuring that both children receive roughly the same monetary inheritance?
You don't state why Child A needs $15,000 a year for the next 23 years. Even without that information, you can do anything you want with "your" money even providing additional support for one child over the other. I don't view an inheritance a right that a child should have access too while you are still alive. It's leftover money that you no longer need, since your dead, so then the kids get to spend it. If this $15k is being requested to support a lifestyle such as a mortgage then I vote no.
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Duffalo714
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Re: Equal Inheritance for Children

Post by Duffalo714 »

Thanks for the answers. I should have posed my question better. Here is more background about my situation. My life expectancy is unknown, so I shouldn’t have said life expectancy of 23 years. I don’t know what my assets will be at death, but I am confident they will be adequate to make equal bequests to both Child A and Child B after deducting the amount I have given Child A during her lifetime, which I call “an advance on her inheritance.” This amount will be attached to a list of my assets, so is knowable at my death. The two children don’t get along; I’m giving the money to a stepchild, Child A, so transparency and total buy-in won’t work from Child B. I can’t afford to set up separate accounts for each child and leave the money untouched because I must live on the money. A large portion of my estate will come from the sale of my home, which is of course not currently liquid. I have, and am updating, a Revocable Living Trust. I’m strictly looking for some reasonable financial calculator or instructions to guide the executor of my estate, to ensure Child A and Child B receive approximately the same monetary inheritance, taking into account compounding, opportunity cost, inflation, etc. of the money I have given to Child A during her lifetime. The total amount I give Child A during her lifetime, plus some fairness factor, will be deducted from her share of my estate. I’m contemplating giving Child A, for personal reasons, an annual gift equal to the maximum allowable IRS annual exclusion for gifts (currently $15,000). The closest answer to what I’m looking for so far is from”123” who steered me to this “Future Value of an Annuity” calculator: https://www.investopedia.com/calculator/annuityfv.aspx. Assuming I had given Child A $15,000 a year for 23 years (my life expectancy), the future value of these gifts would total $621,457.13. Does that sound about right for the amount that would be deducted from Child A’s share of the estate in this scenario? I’d appreciate further thoughts. Thanks.
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JoeRetire
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Re: Equal Inheritance for Children

Post by JoeRetire »

Duffalo714 wrote: Sun Nov 17, 2019 7:44 pmAssuming I had given Child A $15,000 a year for 23 years (my life expectancy), the future value of these gifts would total $621,457.13. Does that sound about right for the amount that would be deducted from Child A’s share of the estate in this scenario? I’d appreciate further thoughts. Thanks.
(shrug)

You are assuming an interest rate of 5% ?
Why?
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Duffalo714
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Re: Equal Inheritance for Children

Post by Duffalo714 »

What interest rate would you use? My savings are invested in 50% stocks and 50% bonds/cash, and I plan to stick to this allocation for the foreseeable future. Vanguard asset allocation models show an average annual return for a 50/50 allocation of 8.2%.
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JoeRetire
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Re: Equal Inheritance for Children

Post by JoeRetire »

Duffalo714 wrote: Sun Nov 17, 2019 8:30 pm What interest rate would you use? My savings are invested in 50% stocks and 50% bonds/cash, and I plan to stick to this allocation for the foreseeable future. Vanguard asset allocation models show an average annual return for a 50/50 allocation of 8.2%.
I don't know, I guess it depends on your goals. Why would you use less than 8.2% ? Presumably if you could afford to invest $15,000 for Child B each year, it would also return 8.2% annually?

If I wanted to be as mathematically accurate as possible, I'd revise the numbers in my trust document every year to account for the prior year's actual returns. Or leave the actual number blank for now and have your trustee eventually use your actual annual returns on an assumed $15,000 each year, from now until your death.

If I just wanted to take a one time guess and write it into my trust document, I'd probably use whatever has already been my long-term return over the past 23 years of investing (or however many years I had been investing).

Or you could just punt and use a number like 3% or 5% or 8.2%
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RubyTuesday
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Re: Equal Inheritance for Children

Post by RubyTuesday »

Didn’t read everyone’s reply, but to answer the question posed, rather that suggest something else...

Perhaps you can instruct 50% to each, adjusted for the value given to child A in advance, adjusted for CPI-U each year. Straightforward calculation of the actual future value of the gifts given each year.

In other words, when you die in 2045, the actual value of those gifts can be known.
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inbox788
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Re: Equal Inheritance for Children

Post by inbox788 »

I didn't see anyone mention life insurance, and whether it would make sense in your particular situation. If you could qualify for $1M 20 year term life for $3-5k/year, or about $100k for 20 years, it could dramatically alter your thinking. In 20 years, you'd be $100k poorer, but know a lot more about everyone. I wonder how much a whole life policy would cost at this stage, and whether that's easier to qualify. But even if you could stretch payment 10 years or more, it's still probably more than the $15k you're advancing now, which you say you can't afford both. Anyway, just trying to cover all the bases.
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Duffalo714
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Re: Equal Inheritance for Children

Post by Duffalo714 »

Ruby Tuesday’s suggestion to use a Consumer Price Index (CPI) calculator seems like the best idea for my purpose. Again, I was just looking for a calculation tool. Thank you. As an example, if I gave someone $15,000 in 2000, that $15,000 has the same buying power of $22,185 in October 2019. Therefore, when I die and the total amount of money that I gifted is known, the actual value of those gifts in today's dollars can be known.
aristotelian
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Re: Equal Inheritance for Children

Post by aristotelian »

Based on your update, it is clear that you can, in fact, afford to give both kids 15k. Otherwise you could not be confident in having that amount left. Giving them both equal amounts now is the cleanest solution. If one doesnt need the money, he can refuse the gift or donate it to charity.
Dandy
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Re: Equal Inheritance for Children

Post by Dandy »

touchy issue. When the children lived at home we supported each based on their needs. One had extra activities which cost more. We didn't keep a ledger to even up for the other child. One went away to college which was more expensive, the other commuted locally - their choice. Again we didn't keep score to compare who got more education expenses.

One got married and had children and a mortgage. We helped with the down payment and lots of support for the children e.g. extra activities. The other child lived at home longer. Essentially, we gave as each situation of need came about and continue to do so.

For the last several years we gave both couples an equal "early inheritance" gift and plan to continue that practice. But, while alive we will help each as they need.

Inheritance will likely be equal unless a significant need arises e.g. a someone with a disability.
bayview
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Re: Equal Inheritance for Children

Post by bayview »

You haven't told us why (which is perfectly appropriate) you want to support Child A yearly until your death. Is it possible that this guaranteed income of $15k a year would in fact hold Child A back in terms of gaining maturity and financial independence? You don't want to kill with kindness. Is this money needed for survival or at least living halfway decently, or is it just helpful?

Perhaps you might consider this: give both of them an option of $Xk per year now (whatever you can afford, divided by 2) OR investing that same figure for them, available at your death. Whichever they choose, that's their choice: they don't have the income now, or they inherit a lesser lump sum at your death.

If one of them (Child A) doesn't understand that this is fair, and that s/he will get a lesser amount at your death, that needs to be addressed now. Also, put a provision in your will and trust that any challenge to provisions results in immediate disinheritance.

Is your spouse, presumably the parent of Child A, or your spouse's family doing anything to support Child A?
Duffalo714 wrote: Sun Nov 17, 2019 7:44 pm Thanks for the answers. I should have posed my question better. Here is more background about my situation. My life expectancy is unknown, so I shouldn’t have said life expectancy of 23 years. I don’t know what my assets will be at death, but I am confident they will be adequate to make equal bequests to both Child A and Child B after deducting the amount I have given Child A during her lifetime, which I call “an advance on her inheritance.” This amount will be attached to a list of my assets, so is knowable at my death. The two children don’t get along; I’m giving the money to a stepchild, Child A, so transparency and total buy-in won’t work from Child B. I can’t afford to set up separate accounts for each child and leave the money untouched because I must live on the money. A large portion of my estate will come from the sale of my home, which is of course not currently liquid. I have, and am updating, a Revocable Living Trust. I’m strictly looking for some reasonable financial calculator or instructions to guide the executor of my estate, to ensure Child A and Child B receive approximately the same monetary inheritance, taking into account compounding, opportunity cost, inflation, etc. of the money I have given to Child A during her lifetime. The total amount I give Child A during her lifetime, plus some fairness factor, will be deducted from her share of my estate. I’m contemplating giving Child A, for personal reasons, an annual gift equal to the maximum allowable IRS annual exclusion for gifts (currently $15,000). The closest answer to what I’m looking for so far is from”123” who steered me to this “Future Value of an Annuity” calculator: https://www.investopedia.com/calculator/annuityfv.aspx. Assuming I had given Child A $15,000 a year for 23 years (my life expectancy), the future value of these gifts would total $621,457.13. Does that sound about right for the amount that would be deducted from Child A’s share of the estate in this scenario? I’d appreciate further thoughts. Thanks.
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FBN2014
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Re: Equal Inheritance for Children

Post by FBN2014 »

I have been struggling with a similar decision as to how to be fair to my two daughters regarding inheritance. I paid for both daughters' undergrad educations at state schools with similar expenses. I paid for both weddings. However daughter #2 decided to continue her education in grad school for another 3 years, graduating with her doctorate in physical therapy. She paid with a partial scholarship and student loans ($90K). When she graduated I paid off the loans. My thinking was that we will deduct the $90K from her inheritance and allocate it to daughter #1 whenever that happens but now I realize 90K is not worth the same in today's dollars as it might be in 20 or 30 years. Any thoughts as how to be fair to both daughters so that it doesn't cause issues between them down the road?
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TomatoTomahto
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Re: Equal Inheritance for Children

Post by TomatoTomahto »

@FBN2014, I think the accounting to be “equal” gets too complicated, to the point that fairness becomes a fetish. It’s like going out with friends; splitting the bill equally is more friendly than tallying “okay, who had the turkey sandwich, who had the Reuben?” If someone ordered and drank an expensive bottle of wine, perhaps adjust, but the corresponding situation in a family would be special expenses for sports, medical needs, etc. Do you adjust for a child who needed orthodontia while the other didn’t?

Be equal in your heart. Everything else is peanuts.
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JoeRetire
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Re: Equal Inheritance for Children

Post by JoeRetire »

FBN2014 wrote: Wed Nov 20, 2019 9:01 pmMy thinking was that we will deduct the $90K from her inheritance and allocate it to daughter #1 whenever that happens but now I realize 90K is not worth the same in today's dollars as it might be in 20 or 30 years. Any thoughts as how to be fair to both daughters so that it doesn't cause issues between them down the road?
First you have to decide what "fair" means to you.

Some would feel that taking $90k off the top is fair, but you apparently don't think so. Others would feel that taking the inflation-adjusted equivalent of $90k off the top would be fair. And others would say not to worry about it at all, that paying off a loan that happened 20 years in the past shouldn't be a consideration at all. The latter would be my preference.

If you can't come to a conclusion and it bothers you enough, consider discussing it with your daughters and see what they would prefer. If you have the financial wherewithal, you might even decide to give $90k to daughter #1 now and be done with it.

Remember that other instances might come up in the next 20-30 years where you will help one daughter financially more than the other. Whatever you decide now would set a precedence.
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Carl53
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Re: Equal Inheritance for Children

Post by Carl53 »

Years ago, several times we received a $10k or $15k check from my parents. When I asked why, I was told that my older sister was in a financial bind and they were helping her out. My other sibling and I received a like amount. When my parents passed nearly two decades later there was no dissension as to the remaining estate as it was split into thirds and there had been like treatment with earlier disbursement. Even as to each receiving a 1/6 share in an out of state vacant tract. One sibling eventually deeded their share to the other two of us as they tired of sharing in the taxes. That relates to the only minor dissension regarding that property. An uncle had deeded me a 50% share forty years ago and left diamond rings and other jewelry to the other two. There was a comment that I had got the property from the uncle, and I note that the value at the time probably was quite similar to the jewelry and I had had the privilege of paying taxes annually. No further comments were made.

Regarding college expenses, we handled them differently. Once child had a full ride, which they lost after two years and a significant parent/student interaction. There was some parental support for a third year but despite assurances of student effort, the results were the same. We cut off all financial support. Several years later, the student matured enough to work hard and finish up a degree with a high level of effort/GPA during that period. Following graduation, I did pay off one of the student's smaller loans (I had cosigned for). The other child only had a couple minor scholarships, but made expected progress and attained the degree. We paid every dime of that child's college tuition/fees/room and board. No animosity between siblings, just parenting that seems to have been appreciated. We are now looking at gifting some of our resources and expect to do so equally.
remomnyc
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Re: Equal Inheritance for Children

Post by remomnyc »

Duffalo714 wrote: Mon Nov 18, 2019 9:42 pm Ruby Tuesday’s suggestion to use a Consumer Price Index (CPI) calculator seems like the best idea for my purpose. Again, I was just looking for a calculation tool. Thank you. As an example, if I gave someone $15,000 in 2000, that $15,000 has the same buying power of $22,185 in October 2019. Therefore, when I die and the total amount of money that I gifted is known, the actual value of those gifts in today's dollars can be known.
Agree that it is impossible to be fair, but I too like Ruby Tuesday's situation for its simplicity and easy calculation, assuming there is sufficient money left at the end to execute this plan "fairly".
Carl53
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Re: Equal Inheritance for Children

Post by Carl53 »

remomnyc wrote: Thu Nov 21, 2019 9:14 am
Duffalo714 wrote: Mon Nov 18, 2019 9:42 pm Ruby Tuesday’s suggestion to use a Consumer Price Index (CPI) calculator seems like the best idea for my purpose. Again, I was just looking for a calculation tool. Thank you. As an example, if I gave someone $15,000 in 2000, that $15,000 has the same buying power of $22,185 in October 2019. Therefore, when I die and the total amount of money that I gifted is known, the actual value of those gifts in today's dollars can be known.
Agree that it is impossible to be fair, but I too like Ruby Tuesday's situation for its simplicity and easy calculation, assuming there is sufficient money left at the end to execute this plan "fairly".
If all of your assets are cash, or sufficient assets are cash to cover the CPI adjusted gifts, then it works. I like it. However, currently the bulk of our assets are in retirement accounts that would not be amenable to having adjustments to beneficiary percentages. Not sure how you could work around that.
clip651
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Re: Equal Inheritance for Children

Post by clip651 »

Carl53 wrote: Thu Nov 21, 2019 10:15 am
remomnyc wrote: Thu Nov 21, 2019 9:14 am
Duffalo714 wrote: Mon Nov 18, 2019 9:42 pm Ruby Tuesday’s suggestion to use a Consumer Price Index (CPI) calculator seems like the best idea for my purpose. Again, I was just looking for a calculation tool. Thank you. As an example, if I gave someone $15,000 in 2000, that $15,000 has the same buying power of $22,185 in October 2019. Therefore, when I die and the total amount of money that I gifted is known, the actual value of those gifts in today's dollars can be known.
Agree that it is impossible to be fair, but I too like Ruby Tuesday's situation for its simplicity and easy calculation, assuming there is sufficient money left at the end to execute this plan "fairly".
If all of your assets are cash, or sufficient assets are cash to cover the CPI adjusted gifts, then it works. I like it. However, currently the bulk of our assets are in retirement accounts that would not be amenable to having adjustments to beneficiary percentages. Not sure how you could work around that.
I assume you mean beneficiary percentages couldn't be adjusted based on calculations made after you deaths. Well, I suppose you could recalculate yearly, and update beneficiary percentages yearly as you go. You might need to authorize someone else to be available to do it for you in the future if you weren't able to manage it yourself at some point, though. And that would require the right paperwork for the financial institutions and a high level of trust in the person you pick.

Not recommending this, it's just an idea. A lot could go wrong with it.
delamer
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Re: Equal Inheritance for Children

Post by delamer »

FBN2014 wrote: Wed Nov 20, 2019 9:01 pm I have been struggling with a similar decision as to how to be fair to my two daughters regarding inheritance. I paid for both daughters' undergrad educations at state schools with similar expenses. I paid for both weddings. However daughter #2 decided to continue her education in grad school for another 3 years, graduating with her doctorate in physical therapy. She paid with a partial scholarship and student loans ($90K). When she graduated I paid off the loans. My thinking was that we will deduct the $90K from her inheritance and allocate it to daughter #1 whenever that happens but now I realize 90K is not worth the same in today's dollars as it might be in 20 or 30 years. Any thoughts as how to be fair to both daughters so that it doesn't cause issues between them down the road?
If you have the funds, give daughter #1 $90K today.
randomguy
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Re: Equal Inheritance for Children

Post by randomguy »

remomnyc wrote: Thu Nov 21, 2019 9:14 am
Duffalo714 wrote: Mon Nov 18, 2019 9:42 pm Ruby Tuesday’s suggestion to use a Consumer Price Index (CPI) calculator seems like the best idea for my purpose. Again, I was just looking for a calculation tool. Thank you. As an example, if I gave someone $15,000 in 2000, that $15,000 has the same buying power of $22,185 in October 2019. Therefore, when I die and the total amount of money that I gifted is known, the actual value of those gifts in today's dollars can be known.
Agree that it is impossible to be fair, but I too like Ruby Tuesday's situation for its simplicity and easy calculation, assuming there is sufficient money left at the end to execute this plan "fairly".
If you were a kid, would you rather get 1000 dollars now or 1000 CPI adjusted dollars in 20 years? The first option is likely to give you 2-3x as much money. For example 50/50 over the last 20 years (i.e. a historically below average period) would result in 10k going to 30k nominal while CPI wise 10k goes to 15k.

And with any scheme the kid getting the lessor amount of money can struggle with it. It might not seem fair at the time to get 500k less as the memory of those earlier distributions has long since faded. It can be a tough situation to handle.
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SmileyFace
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Re: Equal Inheritance for Children

Post by SmileyFace »

If you want to put serious thought into it, here is a good book on the topic that covers many scenarios:

https://www.amazon.com/Beyond-Grave-Rev ... 0062336223

This book was recommended by someone here to me a few years ago - it was a good read and gave me a few different ways and ideas to look at various scenarios.
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LilyFleur
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Re: Equal Inheritance for Children

Post by LilyFleur »

One of my children, "A," has graduated from college and is working a first job. I told A (who is a good saver) that I would match their Roth contribution. So A saved $3,000 for a Roth this year and I put in $3,000.

The other child, "B," is not a saver. I have a separate brokerage account with B as beneficiary. When I help A, I tell A that I have put an equal amount in B's account which is in my name but which B will inherit some day. If B graduates from college, B will get the same graduation gift that A received, as it is already in that account. But I won't give it to B in a lump sum. It will be given in smaller amounts so it doesn't get squandered. Or maybe I will save some of it for B's self-imposed financial emergencies. B is a smart person and may end up in grad school, and I could help B with a weekly amount instead of a lump sum at B's undergrad graduation.

I am considering doing a trust just so B would not inherit everything all at once. I think it should be a phased-in approach, or B could blow it all and then come begging to A for help. Or perhaps I should give A a specific fund for the purpose of helping B.

It's difficult.
FBN2014
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Re: Equal Inheritance for Children

Post by FBN2014 »

LilyFleur wrote: Thu Nov 21, 2019 7:22 pm One of my children, "A," has graduated from college and is working a first job. I told A (who is a good saver) that I would match their Roth contribution. So A saved $3,000 for a Roth this year and I put in $3,000.

The other child, "B," is not a saver. I have a separate brokerage account with B as beneficiary. When I help A, I tell A that I have put an equal amount in B's account which is in my name but which B will inherit some day. If B graduates from college, B will get the same graduation gift that A received, as it is already in that account. But I won't give it to B in a lump sum. It will be given in smaller amounts so it doesn't get squandered. Or maybe I will save some of it for B's self-imposed financial emergencies. B is a smart person and may end up in grad school, and I could help B with a weekly amount instead of a lump sum at B's undergrad graduation.

I am considering doing a trust just so B would not inherit everything all at once. I think it should be a phased-in approach, or B could blow it all and then come begging to A for help. Or perhaps I should give A a specific fund for the purpose of helping B.

It's difficult.
I understand your reasoning and it is sound but I warn you not to make "A" the trustee for any trust you create for "B". That will result in "B" resenting "A" and making 'A's" life a living hell. I speak from experience.
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peseta
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Re: Equal Inheritance for Children

Post by peseta »

As others have observed, once you begin making "advance bequests," there's no easy way to guarantee ensure "evening-up" in the future estate.

Here's an example. Relative sold her house to move into an in-law suite in child's new house, and the sale proceeds put down a lot of the down payment. Will says that this child's share would be reduced by this amount vis-a-vis relative's other children. I'm not sure that's adjusted by inflation/interest or not . . . which doesn't matter because now-elderly relative sadly suffered a negative medical outcome that means relative will likely spend remaining days in a nursing home. The medicaid spend-down will likely mean there is minimal or no estate left, so other children won't get equal share (and possibly none at all).

This was done in all sincerity and other children don't seem to be that upset, in part because the child who benefited had taken on lion's share of care for elderly relative. But, the gameplan was a failure because the money won't be there at the back end.

Point: you don't know what the future will bring. If the goal is to ensure true 50/50 equity, only way to guarantee that is to give each child identical advance gifts.
politely
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Re: Equal Inheritance for Children

Post by politely »

I don't think there's an easy way to be exactly fair, but on the other hand, I don't think that's necessary. As long as you've tried to be fair, that may be enough. I don't know your family dynamics, but in mine where my siblings are receiving current gifts and I will receive assets upon my parents passing, I don't expect that we'll be running NPV and forensic calculations. While I don't know for sure, I think what we'll care about is whether they thought of us and tried to be fair, rather than trying to tally every penny. If you have a will, you can add your thoughts and be explicit about your rationale, and that may be helpful to your survivors.
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Re: Equal Inheritance for Children

Post by Admiral »

I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
saagar_is_cool
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Re: Equal Inheritance for Children

Post by saagar_is_cool »

Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Shouldn't your sister be getting her half+ $X/2 and you should be getting half - $X/2. Let us say inheritance was $110k and you got $10k towards tuition. If you had not taken it, each would get $55k. So, if you did take $10k, then it should not become $40k and $60k and should still be $55k.
Last edited by saagar_is_cool on Fri Nov 22, 2019 9:53 am, edited 1 time in total.
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Re: Equal Inheritance for Children

Post by Admiral »

saagar_is_cool wrote: Fri Nov 22, 2019 9:46 am
Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Shouldn't your sister be getting her half+ $X/2 and you should be getting half + $X/2. Let us say inheritance was $110k and you got $10k towards tuition. If you had not taken it, each would get $55k. So, if you did take $10k, then it should not become $40k and $60k and should still be $55k.
Ha. Perhaps but that's not how it's written. She would not have gotten half of what they gave me, she would have gotten the same amount. So:

Assume $100k inheritance. Equal shares is 50k
I accept 10k. She declines 10k.
At death, she gets her 10k added, I get mine subtracted.
saagar_is_cool
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Re: Equal Inheritance for Children

Post by saagar_is_cool »

Admiral wrote: Fri Nov 22, 2019 9:52 am
saagar_is_cool wrote: Fri Nov 22, 2019 9:46 am
Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Shouldn't your sister be getting her half+ $X/2 and you should be getting half + $X/2. Let us say inheritance was $110k and you got $10k towards tuition. If you had not taken it, each would get $55k. So, if you did take $10k, then it should not become $40k and $60k and should still be $55k.
Ha. Perhaps but that's not how it's written. She would not have gotten half of what they gave me, she would have gotten the same amount. So:

Assume $100k inheritance. Equal shares is 50k
I accept 10k. She declines 10k.
At death, she gets her 10k added, I get mine subtracted.
I do not want to nitpick, but I think in the $10k, you took, $5k was already your share and $5k was borrowed from hers. This is, if we are not considering growth aspect of it.
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Re: Equal Inheritance for Children

Post by Admiral »

saagar_is_cool wrote: Fri Nov 22, 2019 9:54 am
Admiral wrote: Fri Nov 22, 2019 9:52 am
saagar_is_cool wrote: Fri Nov 22, 2019 9:46 am
Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Shouldn't your sister be getting her half+ $X/2 and you should be getting half + $X/2. Let us say inheritance was $110k and you got $10k towards tuition. If you had not taken it, each would get $55k. So, if you did take $10k, then it should not become $40k and $60k and should still be $55k.
Ha. Perhaps but that's not how it's written. She would not have gotten half of what they gave me, she would have gotten the same amount. So:

Assume $100k inheritance. Equal shares is 50k
I accept 10k. She declines 10k.
At death, she gets her 10k added, I get mine subtracted.
I do not want to nitpick, but I think in the $10k, you took, $5k was already your share and $5k was borrowed from hers. This is, if we are not considering growth aspect of it.
Yes, I suppose that's true. Maybe I should read the will more closely. :D Technically you're correct. And, of course, we could also say that the entire pot is now smaller (both our eventual shares) since the $10k was spent instead of remaining in the estate to grow. But we have not gotten that far into the weeds as ultimately this will be a small amount of the overall estate.
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Re: Equal Inheritance for Children

Post by Broken Man 1999 »

Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Personally, I think you should be entitled to the same inheritance as your sister. I just don't believe declined offers of financial aid for education builds up credits for inheritance.

Financial help for education is fair if offered under the same conditions for each. I don't think of it as $$$ offered, rather educational degrees offered. I told DDs that I would help them with college up to whatever degree level they wanted to shoot for. I didn't say, "I will spend $X on each of your college educations." Had one continued on to earn a PhD, that would have been fine, also.

We paid a more for one DD's Bachelors degree, as she went to a private university, out of town. Though, her tuition was 100% covered by scholarships. One DD went to a public university. We had Florida Pre-paid tuition plans for both, which saved us a lot of money.

DD at private university also received free tuition for her MBA. The other DD went to a private university for her Masters degree, which we paid for, totally.

I have never even contemplated tallying up their various college costs in an attempt to be fair. But, I believe the costs were probably pretty close. Though, honestly I don't really care. Each daughter went to their preferred university, for undergraduate and graduate degrees.

If one DD had eschewed attending college with our financial help, I would never have assumed she would be entitled to more of our estate. An unaccepted offer of education is just that: An offer of education, nothing more, nothing less. No other expectations on the part of either of us, I would hope.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain
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Re: Equal Inheritance for Children

Post by Admiral »

Broken Man 1999 wrote: Fri Nov 22, 2019 11:24 am
Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Personally, I think you should be entitled to the same inheritance as your sister. I just don't believe declined offers of financial aid for education builds up credits for inheritance.

Financial help for education is fair if offered under the same conditions for each. I don't think of it as $$$ offered, rather educational degrees offered. I told DDs that I would help them with college up to whatever degree level they wanted to shoot for. I didn't say, "I will spend $X on each of your college educations." Had one continued on to earn a PhD, that would have been fine, also.

We paid a more for one DD's Bachelors degree, as she went to a private university, out of town. Though, her tuition was 100% covered by scholarships. One DD went to a public university. We had Florida Pre-paid tuition plans for both, which saved us a lot of money.

DD at private university also received free tuition for her MBA. The other DD went to a private university for her Masters degree, which we paid for, totally.

I have never even contemplated tallying up their various college costs in an attempt to be fair. But, I believe the costs were probably pretty close. Though, honestly I don't really care. Each daughter went to their preferred university, for undergraduate and graduate degrees.

If one DD had eschewed attending college with our financial help, I would never have assumed she would be entitled to more of our estate. An unaccepted offer of education is just that: An offer of education, nothing more, nothing less. No other expectations on the part of either of us, I would hope.

Broken Man 1999
Well it's not my money and hence it's not my decision. People offer what they can afford, it might be a set amount, it might be "sky's the limit." I heard an anecdote from a friend that went like this:

Parents offered to cover education for two kids. #1 kid went to law school, #2 kid did not. Parents paid for both kids education, and clearly kid #1 got a "better deal". Now #2 kid wants the same amount of money (in cash, for his own kids) that parents spent on law school for kid #1.

People think about money (and entitlement) in different ways. I think in the above example kid #2 is unreasonable. But, some might say, fair is fair, so give the kid the same amount.
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Re: Equal Inheritance for Children

Post by TomatoTomahto »

People sure are different, @Admiral. I’d dock kid #2 1% every time it was brought up. My money, my rules.

So, who had the turkey sub?
Okay, I get it; I won't be political or controversial. The Earth is flat.
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Re: Equal Inheritance for Children

Post by Broken Man 1999 »

Admiral wrote: Fri Nov 22, 2019 11:32 am
Broken Man 1999 wrote: Fri Nov 22, 2019 11:24 am
Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Personally, I think you should be entitled to the same inheritance as your sister. I just don't believe declined offers of financial aid for education builds up credits for inheritance.

Financial help for education is fair if offered under the same conditions for each. I don't think of it as $$$ offered, rather educational degrees offered. I told DDs that I would help them with college up to whatever degree level they wanted to shoot for. I didn't say, "I will spend $X on each of your college educations." Had one continued on to earn a PhD, that would have been fine, also.

We paid a more for one DD's Bachelors degree, as she went to a private university, out of town. Though, her tuition was 100% covered by scholarships. One DD went to a public university. We had Florida Pre-paid tuition plans for both, which saved us a lot of money.

DD at private university also received free tuition for her MBA. The other DD went to a private university for her Masters degree, which we paid for, totally.

I have never even contemplated tallying up their various college costs in an attempt to be fair. But, I believe the costs were probably pretty close. Though, honestly I don't really care. Each daughter went to their preferred university, for undergraduate and graduate degrees.

If one DD had eschewed attending college with our financial help, I would never have assumed she would be entitled to more of our estate. An unaccepted offer of education is just that: An offer of education, nothing more, nothing less. No other expectations on the part of either of us, I would hope.

Broken Man 1999
Well it's not my money and hence it's not my decision. People offer what they can afford, it might be a set amount, it might be "sky's the limit." I heard an anecdote from a friend that went like this:

Parents offered to cover education for two kids. #1 kid went to law school, #2 kid did not. Parents paid for both kids education, and clearly kid #1 got a "better deal". Now #2 kid wants the same amount of money (in cash, for his own kids) that parents spent on law school for kid #1.

People think about money (and entitlement) in different ways. I think in the above example kid #2 is unreasonable. But, some might say, fair is fair, so give the kid the same amount.
Well, as you say, it is all up to the one holding the money.

In your example concerning the law school/no law school, I would tell #2 kid to pound sand. And, for good measure, I might even leave him LESS than #1 kid. Where do people get the notion they have any right to carve up their possible inheritances as they choose? Not in my world, for sure. So long as #2 kid had the same opportunity, the parent's gift was square, IMHO. And, frankly, certain professions require more brains than others, and brainpower isn't distributed equally across the great unwashed masses, and certainly not in families with multiple children. Not everybody is capable of entering every field of study offered.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain
delamer
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Re: Equal Inheritance for Children

Post by delamer »

Broken Man 1999 wrote: Fri Nov 22, 2019 11:59 am
Admiral wrote: Fri Nov 22, 2019 11:32 am
Broken Man 1999 wrote: Fri Nov 22, 2019 11:24 am
Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Personally, I think you should be entitled to the same inheritance as your sister. I just don't believe declined offers of financial aid for education builds up credits for inheritance.

Financial help for education is fair if offered under the same conditions for each. I don't think of it as $$$ offered, rather educational degrees offered. I told DDs that I would help them with college up to whatever degree level they wanted to shoot for. I didn't say, "I will spend $X on each of your college educations." Had one continued on to earn a PhD, that would have been fine, also.

We paid a more for one DD's Bachelors degree, as she went to a private university, out of town. Though, her tuition was 100% covered by scholarships. One DD went to a public university. We had Florida Pre-paid tuition plans for both, which saved us a lot of money.

DD at private university also received free tuition for her MBA. The other DD went to a private university for her Masters degree, which we paid for, totally.

I have never even contemplated tallying up their various college costs in an attempt to be fair. But, I believe the costs were probably pretty close. Though, honestly I don't really care. Each daughter went to their preferred university, for undergraduate and graduate degrees.

If one DD had eschewed attending college with our financial help, I would never have assumed she would be entitled to more of our estate. An unaccepted offer of education is just that: An offer of education, nothing more, nothing less. No other expectations on the part of either of us, I would hope.

Broken Man 1999
Well it's not my money and hence it's not my decision. People offer what they can afford, it might be a set amount, it might be "sky's the limit." I heard an anecdote from a friend that went like this:

Parents offered to cover education for two kids. #1 kid went to law school, #2 kid did not. Parents paid for both kids education, and clearly kid #1 got a "better deal". Now #2 kid wants the same amount of money (in cash, for his own kids) that parents spent on law school for kid #1.

People think about money (and entitlement) in different ways. I think in the above example kid #2 is unreasonable. But, some might say, fair is fair, so give the kid the same amount.
Well, as you say, it is all up to the one holding the money.

In your example concerning the law school/no law school, I would tell #2 kid to pound sand. And, for good measure, I might even leave him LESS than #1 kid. Where do people get the notion they have any right to carve up their possible inheritances as they choose? Not in my world, for sure. So long as #2 kid had the same opportunity, the parent's gift was square, IMHO. And, frankly, certain professions require more brains than others, and brainpower isn't distributed equally across the great unwashed masses, and certainly in families with multiple children. Not everybody is capable of entering every field of study offered.

Broken Man 1999
Say you had two equally hardworking, conscientious, law-abiding children, but one had a superior intellect and therefore much higher earning power.

You’d pay for the more intelligent one to go to law school but wouldn’t, for example, provide funds to the other for a house downpayment in lieu of law school tuition?

Sink or swim, isn’t your fault that the law student is smarter than her brother.
Admiral
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Re: Equal Inheritance for Children

Post by Admiral »

delamer wrote: Fri Nov 22, 2019 12:06 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 11:59 am
Admiral wrote: Fri Nov 22, 2019 11:32 am
Broken Man 1999 wrote: Fri Nov 22, 2019 11:24 am
Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Personally, I think you should be entitled to the same inheritance as your sister. I just don't believe declined offers of financial aid for education builds up credits for inheritance.

Financial help for education is fair if offered under the same conditions for each. I don't think of it as $$$ offered, rather educational degrees offered. I told DDs that I would help them with college up to whatever degree level they wanted to shoot for. I didn't say, "I will spend $X on each of your college educations." Had one continued on to earn a PhD, that would have been fine, also.

We paid a more for one DD's Bachelors degree, as she went to a private university, out of town. Though, her tuition was 100% covered by scholarships. One DD went to a public university. We had Florida Pre-paid tuition plans for both, which saved us a lot of money.

DD at private university also received free tuition for her MBA. The other DD went to a private university for her Masters degree, which we paid for, totally.

I have never even contemplated tallying up their various college costs in an attempt to be fair. But, I believe the costs were probably pretty close. Though, honestly I don't really care. Each daughter went to their preferred university, for undergraduate and graduate degrees.

If one DD had eschewed attending college with our financial help, I would never have assumed she would be entitled to more of our estate. An unaccepted offer of education is just that: An offer of education, nothing more, nothing less. No other expectations on the part of either of us, I would hope.

Broken Man 1999
Well it's not my money and hence it's not my decision. People offer what they can afford, it might be a set amount, it might be "sky's the limit." I heard an anecdote from a friend that went like this:

Parents offered to cover education for two kids. #1 kid went to law school, #2 kid did not. Parents paid for both kids education, and clearly kid #1 got a "better deal". Now #2 kid wants the same amount of money (in cash, for his own kids) that parents spent on law school for kid #1.

People think about money (and entitlement) in different ways. I think in the above example kid #2 is unreasonable. But, some might say, fair is fair, so give the kid the same amount.
Well, as you say, it is all up to the one holding the money.

In your example concerning the law school/no law school, I would tell #2 kid to pound sand. And, for good measure, I might even leave him LESS than #1 kid. Where do people get the notion they have any right to carve up their possible inheritances as they choose? Not in my world, for sure. So long as #2 kid had the same opportunity, the parent's gift was square, IMHO. And, frankly, certain professions require more brains than others, and brainpower isn't distributed equally across the great unwashed masses, and certainly in families with multiple children. Not everybody is capable of entering every field of study offered.

Broken Man 1999
Say you had two equally hardworking, conscientious, law-abiding children, but one had a superior intellect and therefore much higher earning power.

You’d pay for the more intelligent one to go to law school but wouldn’t, for example, provide funds to the other for a house downpayment in lieu of law school tuition?

Sink or swim, isn’t your fault that the law student is smarter than her brother.
I also think that there's a distinction between "I'm going to pay for John and Jill's education" and "I'm going to give both John and Jill $50,000, and they can use it however they want."

Obviously if one drops it all on the ponies, that's a distressing decision. But it's one the giver would have to live with, if the offer is "money" and not "money for something." If Jill chooses a state school and John chooses Harvard, that's quite a price differential. If the offer is "money" then both siblings should get the same amount. The one at State will simply be able to pay for two years to Harvard's one.
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Re: Equal Inheritance for Children

Post by downshiftme »

I also think that there's a distinction between "I'm going to pay for John and Jill's education" and "I'm going to give both John and Jill $50,000, and they can use it however they want."

Obviously if one drops it all on the ponies, that's a distressing decision. But it's one the giver would have to live with, if the offer is "money" and not "money for something." If Jill chooses a state school and John chooses Harvard, that's quite a price differential. If the offer is "money" then both siblings should get the same amount. The one at State will simply be able to pay for two years to Harvard's one.
Every situation may be unique to the people and family involved. I really like the idea of my children getting a good education and encouraged them to seek college degrees at my expense. One went to a state school, but took a couple extra years to graduate. One went to an out of state private school at more than double the cost of the first child. I have no intention of doing anything financially to equalize these gifts. I didn't cut off the funds when one child took longer than expected to graduate. I don't intend to cut off the funds if either decides to pursue a higher degree. Perhaps there are wasteful pointless degrees that I would draw a line at if I suspected that a child was just taking advantage of my generosity to party and be irresponsible, but fortunately we are not in that situation.

But the point is that my gift was the education, which is not a one size fits all item. Each child is free to pursue an appropriate education for themselves with only the slightest oversight that it isn't overtly wasteful. Some academic dithering, changes of major, changes of school, personal difficulty requiring a bit of reset, and other issues are all part of getting that education and I support them through any of that.

What I am not doing is keeping any kind of financial score and I will not be equalizing the outlays of funds. Maybe this is because education is so important to me that I want to support educational choices more than I value equal financial divisions. Maybe it's a luxury because I can make such an educational gift without impoverishing myself.

Other reasons besides education needing parental financial support have not come up and maybe they deserve different accounting treatment. I think each needs to be taken on a case by case basis. Education is one major expense I would explicitly not consider in equalizing. Others I will have to think about when I know the particular details. Although I generally like the idea of simple equal inheritances for siblings, I don't like the idea that you need to make adjustments for every expense that may have been unequal for a lifetime.
Broken Man 1999
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Re: Equal Inheritance for Children

Post by Broken Man 1999 »

delamer wrote: Fri Nov 22, 2019 12:06 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 11:59 am
Admiral wrote: Fri Nov 22, 2019 11:32 am
Broken Man 1999 wrote: Fri Nov 22, 2019 11:24 am
Admiral wrote: Fri Nov 22, 2019 9:35 am I can tell you what my (still living) parents have done. They offered to help both me and my sister out with tuition payments. I accepted, my sister did not. They gift us the money. Their will (of which I have a copy) simply states that on their demise, I have already received $X, so my share of the estate is half, minus $X. My sister gets gets half, plus $X. Seems fair to us.

Granted, it's not exactly the same situation. I do feel that if you're going to offer to give funds to one child (while you're living) the identical offer should be made to the other. They can take it or leave it.

My sister and I get along so there's unlikely to be fighting over the estate, which is 7 figures.
Personally, I think you should be entitled to the same inheritance as your sister. I just don't believe declined offers of financial aid for education builds up credits for inheritance.

Financial help for education is fair if offered under the same conditions for each. I don't think of it as $$$ offered, rather educational degrees offered. I told DDs that I would help them with college up to whatever degree level they wanted to shoot for. I didn't say, "I will spend $X on each of your college educations." Had one continued on to earn a PhD, that would have been fine, also.

We paid a more for one DD's Bachelors degree, as she went to a private university, out of town. Though, her tuition was 100% covered by scholarships. One DD went to a public university. We had Florida Pre-paid tuition plans for both, which saved us a lot of money.

DD at private university also received free tuition for her MBA. The other DD went to a private university for her Masters degree, which we paid for, totally.

I have never even contemplated tallying up their various college costs in an attempt to be fair. But, I believe the costs were probably pretty close. Though, honestly I don't really care. Each daughter went to their preferred university, for undergraduate and graduate degrees.

If one DD had eschewed attending college with our financial help, I would never have assumed she would be entitled to more of our estate. An unaccepted offer of education is just that: An offer of education, nothing more, nothing less. No other expectations on the part of either of us, I would hope.

Broken Man 1999
Well it's not my money and hence it's not my decision. People offer what they can afford, it might be a set amount, it might be "sky's the limit." I heard an anecdote from a friend that went like this:

Parents offered to cover education for two kids. #1 kid went to law school, #2 kid did not. Parents paid for both kids education, and clearly kid #1 got a "better deal". Now #2 kid wants the same amount of money (in cash, for his own kids) that parents spent on law school for kid #1.

People think about money (and entitlement) in different ways. I think in the above example kid #2 is unreasonable. But, some might say, fair is fair, so give the kid the same amount.
Well, as you say, it is all up to the one holding the money.

In your example concerning the law school/no law school, I would tell #2 kid to pound sand. And, for good measure, I might even leave him LESS than #1 kid. Where do people get the notion they have any right to carve up their possible inheritances as they choose? Not in my world, for sure. So long as #2 kid had the same opportunity, the parent's gift was square, IMHO. And, frankly, certain professions require more brains than others, and brainpower isn't distributed equally across the great unwashed masses, and certainly in families with multiple children. Not everybody is capable of entering every field of study offered.

Broken Man 1999
Say you had two equally hardworking, conscientious, law-abiding children, but one had a superior intellect and therefore much higher earning power.

You’d pay for the more intelligent one to go to law school but wouldn’t, for example, provide funds to the other for a house downpayment in lieu of law school tuition?

Sink or swim, isn’t your fault that the law student is smarter than her brother.
Short answer: No.

I sincerely believe in equal opportunities, but I can not provide equal outcomes, nor, would I want to do so. In our case we offered education, not dollars. DDs chose their fields, not us. One DD is in a field that is more lucrative, but offers no pension. Other DD is in a field less lucrative, but offers a gold-plated pension. Which daughter is doing better?

I do not see any reason to allow someone to turn my offer of paying for education into a down payment for a house. Two totally different transactions. One, an end goal of a college degree. The other, a simple financial event, $$$$$.

As it turned out, each daughter was given $10,000 after they had their deal on their first home. I didn't want them to move on up due to the gift. Those gifts were fair, as they were specific amounts. I made equal gifts of education, and equal financial gifts for their first home.

So far as law school, there are any number of fields where earnings are high. Every day we all make choices in life. And, we all have to live with those choices.

I would be very nervous in any attempt to try to balance end results. Where does it end?

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain
delamer
Posts: 10517
Joined: Tue Feb 08, 2011 6:13 pm

Re: Equal Inheritance for Children

Post by delamer »

Broken Man 1999 wrote: Fri Nov 22, 2019 2:14 pm
delamer wrote: Fri Nov 22, 2019 12:06 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 11:59 am
Admiral wrote: Fri Nov 22, 2019 11:32 am
Broken Man 1999 wrote: Fri Nov 22, 2019 11:24 am

Personally, I think you should be entitled to the same inheritance as your sister. I just don't believe declined offers of financial aid for education builds up credits for inheritance.

Financial help for education is fair if offered under the same conditions for each. I don't think of it as $$$ offered, rather educational degrees offered. I told DDs that I would help them with college up to whatever degree level they wanted to shoot for. I didn't say, "I will spend $X on each of your college educations." Had one continued on to earn a PhD, that would have been fine, also.

We paid a more for one DD's Bachelors degree, as she went to a private university, out of town. Though, her tuition was 100% covered by scholarships. One DD went to a public university. We had Florida Pre-paid tuition plans for both, which saved us a lot of money.

DD at private university also received free tuition for her MBA. The other DD went to a private university for her Masters degree, which we paid for, totally.

I have never even contemplated tallying up their various college costs in an attempt to be fair. But, I believe the costs were probably pretty close. Though, honestly I don't really care. Each daughter went to their preferred university, for undergraduate and graduate degrees.

If one DD had eschewed attending college with our financial help, I would never have assumed she would be entitled to more of our estate. An unaccepted offer of education is just that: An offer of education, nothing more, nothing less. No other expectations on the part of either of us, I would hope.

Broken Man 1999
Well it's not my money and hence it's not my decision. People offer what they can afford, it might be a set amount, it might be "sky's the limit." I heard an anecdote from a friend that went like this:

Parents offered to cover education for two kids. #1 kid went to law school, #2 kid did not. Parents paid for both kids education, and clearly kid #1 got a "better deal". Now #2 kid wants the same amount of money (in cash, for his own kids) that parents spent on law school for kid #1.

People think about money (and entitlement) in different ways. I think in the above example kid #2 is unreasonable. But, some might say, fair is fair, so give the kid the same amount.
Well, as you say, it is all up to the one holding the money.

In your example concerning the law school/no law school, I would tell #2 kid to pound sand. And, for good measure, I might even leave him LESS than #1 kid. Where do people get the notion they have any right to carve up their possible inheritances as they choose? Not in my world, for sure. So long as #2 kid had the same opportunity, the parent's gift was square, IMHO. And, frankly, certain professions require more brains than others, and brainpower isn't distributed equally across the great unwashed masses, and certainly in families with multiple children. Not everybody is capable of entering every field of study offered.

Broken Man 1999
Say you had two equally hardworking, conscientious, law-abiding children, but one had a superior intellect and therefore much higher earning power.

You’d pay for the more intelligent one to go to law school but wouldn’t, for example, provide funds to the other for a house downpayment in lieu of law school tuition?

Sink or swim, isn’t your fault that the law student is smarter than her brother.
I do not see any reason to allow someone to turn my offer of paying for education into a down payment for a house. Two totally different transactions. One, an end goal of a college degree. The other, a simple financial event, $$$$$.


Broken Man 1999
You are the one raised the issue of not all kids in a family having the equal intellects. So we aren’t talking about the case of 2 kids who are intellectual equals, and one decides on law school and the other declines.

As a parent I wouldn’t completely subsidize one kids’ education through law school but offer nothing financially to her equally hardworking brother who is working as a appliance repairman because he doesn’t have the intellect to get through college & law school.

To each their own.
Broken Man 1999
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Location: West coast of Florida, inland on high ground!

Re: Equal Inheritance for Children

Post by Broken Man 1999 »

delamer wrote: Fri Nov 22, 2019 3:24 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 2:14 pm
delamer wrote: Fri Nov 22, 2019 12:06 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 11:59 am
Admiral wrote: Fri Nov 22, 2019 11:32 am

Well it's not my money and hence it's not my decision. People offer what they can afford, it might be a set amount, it might be "sky's the limit." I heard an anecdote from a friend that went like this:

Parents offered to cover education for two kids. #1 kid went to law school, #2 kid did not. Parents paid for both kids education, and clearly kid #1 got a "better deal". Now #2 kid wants the same amount of money (in cash, for his own kids) that parents spent on law school for kid #1.

People think about money (and entitlement) in different ways. I think in the above example kid #2 is unreasonable. But, some might say, fair is fair, so give the kid the same amount.
Well, as you say, it is all up to the one holding the money.

In your example concerning the law school/no law school, I would tell #2 kid to pound sand. And, for good measure, I might even leave him LESS than #1 kid. Where do people get the notion they have any right to carve up their possible inheritances as they choose? Not in my world, for sure. So long as #2 kid had the same opportunity, the parent's gift was square, IMHO. And, frankly, certain professions require more brains than others, and brainpower isn't distributed equally across the great unwashed masses, and certainly in families with multiple children. Not everybody is capable of entering every field of study offered.

Broken Man 1999
Say you had two equally hardworking, conscientious, law-abiding children, but one had a superior intellect and therefore much higher earning power.

You’d pay for the more intelligent one to go to law school but wouldn’t, for example, provide funds to the other for a house downpayment in lieu of law school tuition?

Sink or swim, isn’t your fault that the law student is smarter than her brother.
I do not see any reason to allow someone to turn my offer of paying for education into a down payment for a house. Two totally different transactions. One, an end goal of a college degree. The other, a simple financial event, $$$$$.


Broken Man 1999
You are the one raised the issue of not all kids in a family having the equal intellects. So we aren’t talking about the case of 2 kids who are intellectual equals, and one decides on law school and the other declines.

As a parent I wouldn’t completely subsidize one kids’ education through law school but offer nothing financially to her equally hardworking brother who is working as a appliance repairman because he doesn’t have the intellect to get through college & law school.

To each their own.
Not being able to enter law school hardly condemns a person to a life of poverty. There are many successful people who have never darkened the entry door of a college. As well as intellect, one cannot exclude initiative as being a positive force in a career. Some people simply aren't college material, just like some aren't good candidates for working with their hands, like trades people.

What would you say, something like this, "Here is some extra money for you, son/daughter, since you just aren't as smart as your brother/sister!"

I would find that really, really insulting, no matter how it was presented.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain
delamer
Posts: 10517
Joined: Tue Feb 08, 2011 6:13 pm

Re: Equal Inheritance for Children

Post by delamer »

Broken Man 1999 wrote: Fri Nov 22, 2019 3:50 pm
delamer wrote: Fri Nov 22, 2019 3:24 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 2:14 pm
delamer wrote: Fri Nov 22, 2019 12:06 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 11:59 am

Well, as you say, it is all up to the one holding the money.

In your example concerning the law school/no law school, I would tell #2 kid to pound sand. And, for good measure, I might even leave him LESS than #1 kid. Where do people get the notion they have any right to carve up their possible inheritances as they choose? Not in my world, for sure. So long as #2 kid had the same opportunity, the parent's gift was square, IMHO. And, frankly, certain professions require more brains than others, and brainpower isn't distributed equally across the great unwashed masses, and certainly in families with multiple children. Not everybody is capable of entering every field of study offered.

Broken Man 1999
Say you had two equally hardworking, conscientious, law-abiding children, but one had a superior intellect and therefore much higher earning power.

You’d pay for the more intelligent one to go to law school but wouldn’t, for example, provide funds to the other for a house downpayment in lieu of law school tuition?

Sink or swim, isn’t your fault that the law student is smarter than her brother.
I do not see any reason to allow someone to turn my offer of paying for education into a down payment for a house. Two totally different transactions. One, an end goal of a college degree. The other, a simple financial event, $$$$$.


Broken Man 1999
You are the one raised the issue of not all kids in a family having the equal intellects. So we aren’t talking about the case of 2 kids who are intellectual equals, and one decides on law school and the other declines.

As a parent I wouldn’t completely subsidize one kids’ education through law school but offer nothing financially to her equally hardworking brother who is working as a appliance repairman because he doesn’t have the intellect to get through college & law school.

To each their own.
Not being able to enter law school hardly condemns a person to a life of poverty. There are many successful people who have never darkened the entry door of a college. As well as intellect, one cannot exclude initiative as being a positive force in a career. Some people simply aren't college material, just like some aren't good candidates for working with their hands, like trades people.

What would you say, something like this, "Here is some extra money for you, son/daughter, since you just aren't as smart as your brother/sister!"

I would find that really, really insulting, no matter how it was presented.

Broken Man 1999
How about “we helped your sister financially with law school, so we’d like to help you financially with a home downpayment.”?
Broken Man 1999
Posts: 5010
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Re: Equal Inheritance for Children

Post by Broken Man 1999 »

delamer wrote: Fri Nov 22, 2019 4:04 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 3:50 pm
delamer wrote: Fri Nov 22, 2019 3:24 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 2:14 pm
delamer wrote: Fri Nov 22, 2019 12:06 pm

Say you had two equally hardworking, conscientious, law-abiding children, but one had a superior intellect and therefore much higher earning power.

You’d pay for the more intelligent one to go to law school but wouldn’t, for example, provide funds to the other for a house downpayment in lieu of law school tuition?

Sink or swim, isn’t your fault that the law student is smarter than her brother.
I do not see any reason to allow someone to turn my offer of paying for education into a down payment for a house. Two totally different transactions. One, an end goal of a college degree. The other, a simple financial event, $$$$$.


Broken Man 1999
You are the one raised the issue of not all kids in a family having the equal intellects. So we aren’t talking about the case of 2 kids who are intellectual equals, and one decides on law school and the other declines.

As a parent I wouldn’t completely subsidize one kids’ education through law school but offer nothing financially to her equally hardworking brother who is working as a appliance repairman because he doesn’t have the intellect to get through college & law school.

To each their own.
Not being able to enter law school hardly condemns a person to a life of poverty. There are many successful people who have never darkened the entry door of a college. As well as intellect, one cannot exclude initiative as being a positive force in a career. Some people simply aren't college material, just like some aren't good candidates for working with their hands, like trades people.

What would you say, something like this, "Here is some extra money for you, son/daughter, since you just aren't as smart as your brother/sister!"

I would find that really, really insulting, no matter how it was presented.

Broken Man 1999
How about “we helped your sister financially with law school, so we’d like to help you financially with a home downpayment.”?
Why not help both with down payment? Wouldn't that be fairer?

Broken Man 1999

ETA: Although my comments were in relation to college gifts, another option for those unable to hack college is trades schools. Our daughters chose college, but on another thread I stated if a grandchild chose trades it wouldn't bother me at all.

I fear it is a slippery slope when parents attempt to square up differences between their childrens earnings by paying things for one, and not the other.
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain
delamer
Posts: 10517
Joined: Tue Feb 08, 2011 6:13 pm

Re: Equal Inheritance for Children

Post by delamer »

Broken Man 1999 wrote: Fri Nov 22, 2019 4:08 pm
delamer wrote: Fri Nov 22, 2019 4:04 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 3:50 pm
delamer wrote: Fri Nov 22, 2019 3:24 pm
Broken Man 1999 wrote: Fri Nov 22, 2019 2:14 pm

I do not see any reason to allow someone to turn my offer of paying for education into a down payment for a house. Two totally different transactions. One, an end goal of a college degree. The other, a simple financial event, $$$$$.


Broken Man 1999
You are the one raised the issue of not all kids in a family having the equal intellects. So we aren’t talking about the case of 2 kids who are intellectual equals, and one decides on law school and the other declines.

As a parent I wouldn’t completely subsidize one kids’ education through law school but offer nothing financially to her equally hardworking brother who is working as a appliance repairman because he doesn’t have the intellect to get through college & law school.

To each their own.
Not being able to enter law school hardly condemns a person to a life of poverty. There are many successful people who have never darkened the entry door of a college. As well as intellect, one cannot exclude initiative as being a positive force in a career. Some people simply aren't college material, just like some aren't good candidates for working with their hands, like trades people.

What would you say, something like this, "Here is some extra money for you, son/daughter, since you just aren't as smart as your brother/sister!"

I would find that really, really insulting, no matter how it was presented.

Broken Man 1999
How about “we helped your sister financially with law school, so we’d like to help you financially with a home downpayment.”?
Why not help both with down payment? Wouldn't that be fairer?

Broken Man 1999

ETA: Although my comments were in relation to college gifts, another option for those unable to hack college is trades schools. Our daughters chose college, but on another thread I stated if a grandchild chose trades it wouldn't bother me at all.

I fear it is a slippery slope when parents attempt to square up differences between their childrens earnings by paying things for one, and not the other.
In college, I took a course called “Philosophy of Justice.” It was geared more to societal issues of how people should be treated, rather than interpersonal relations.

But ultimately, the core issue in that class and in this discussion is “What is fair?” There are lots of answers to that question, and you and I obviously have different ones.
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