Did any inheritance make positive effect on your life?

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Sandtrap
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Re: Did any inheritance make positive effect on your life?

Post by Sandtrap »

SQRT wrote: Mon Aug 17, 2020 8:53 am @stoptothink. Interesting stories. For me it points out that how a person is raised will probably determine how they will deal with an inheritance. If a good job is done early, the chances of problems relating to an inheritance are reduced, I think? Having said that, every family is different. Parents are best able to assess whether their kids are likely to “screw up” or not.
+1
Thus the “modern words” not so much used in the distant past generations but so used today:
Helicopter
Boomerang
Failure to Thrive
Failure to Launch
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Bank of mom and dad.

Family dynamics and individuals are so unique.
OP: Thanks for an interesting thread.

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jnightingale73
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Re: Did any inheritance make positive effect on your life?

Post by jnightingale73 »

I would say yes - both my parents have passed, my dad many years ago, and my mom about 2 years ago. I was able to bank part of my inheritance and invest, the other part helped us pay off a second mortgage, some revolving debt, and build up savings. Having that extra cash on hand has then helped make it easier to max out our 401(k) and 403(b), and we've been able to do a couple of home improvement projects, hopefully increasing the value of our home. So it was pretty much life changing in many ways.
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TomatoTomahto
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Re: Did any inheritance make positive effect on your life?

Post by TomatoTomahto »

Our story:

My step-mother imo didn't adhere to my father's wishes as to how his bequest would be carried out when she subsequently died. He had wanted the assets to be split equally between his 3 biological children and 1 step-child. My step-mother instead tilted towards her two biological children (a step sister to me and half-sister (technically anyway, I grew up with her and consider her my sister)). I got a smaller cut and my sister got nothing.

My half-sister was the executor and wasn't happy about the split. She reached out to my step-sister, who didn't want to change anything and opted out of modification. Between the three of us remaining in the mix, my half-sister and I agreed to cut my sister in, more as a matter of decency and courtesy as anything; my inheritance was all of $11k after the adjustment, and nobody "needed" the inheritance.

So, the "positive effect" of the inheritance was that three siblings who had been in limited contact renewed their interactions, All 4 siblings showed their natures.
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Carefreeap
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Re: Did any inheritance make positive effect on your life?

Post by Carefreeap »

delamer wrote: Sat Aug 15, 2020 3:33 pm
JS-Elcano wrote: Sat Aug 15, 2020 2:23 pm I come from a country and financial background where "leaving/getting an inheritance" was basically unheard of. If a family was very wealthy they had a house and would pass this on to the kids who would then move into this house (or already live there with their parents), rather than sell it. Now that I live here in the US I realize that it's very different and most of my friends and colleagues *know* they will get inheritances. They "know" they will get a million or two and they know they will be set in retirement, so they spend every penny they make (except for some token amounts in pretax retirement plans at work to get the match) without a care in the world. They have a completely different relationship to money than I have or friends who also know they won't get a substantial inheritance. I am not saying their relationship with money is not good, but they have no concept of saving and providing for their own future. It does seem odd to me because what inheritance will they pass onto their children?
If “most” of your friends and colleagues expect to get a million dollars or more in inheritances, you move in rarified circles.

From this link: https://www.newretirement.com/retiremen ... -to-heirs/

When you break down average inheritance by the economic status of the household, the numbers look very different. According to analysis by Demos:

The least wealthy group of families have received, on average, $6,100 in inheritance.
The wealthiest 1 percent of families have received, on average, $2.7 million in inheritance.
A further breakdown of these numbers reveals that: “the wealthiest 1 percent of families have inherited $447 for every $1 the least wealthy group of families has. Those in the middling wealth ranges—$25k–$50k, $50k–$100k, and $100k–$250k—have received inheritances of $14.8k, $22.5k, and $51.4k respectively.”


So don’t assume that most Americans are like the people you know.
I thought the same thing. Other than DH's wealthy side of the family I don't know anyone but DH who inherited $1M.

My parents were financial train wrecks but I didn't realize how bad it truly was until my mom passed 12 years ago. My parents divorced in their 60s after filing BK. When my mom died at age 70 her estate was upside down by $400k. It was mostly due to her home crashing in value in 2008 but there was also credit card debt and unpaid federal taxes. I managed to clean up that mess and squeeze out about 10k for my brother and me.

Dad's barely hanging on. He's in a long term care facility being paid by Medicaid. I am so grateful that DH and I are not paying for his care. We were bracing ourselves for it @5k/mth. Current level of care costs $7k (San Diego County). I hold a bank acct for him but after memorial services and clean up of home (he's a hoarder) I doubt there will be anything left.

Like an earlier poster said, when DH inherited his money at age 43 it allowed him to take some more risk with his job and to better negotiate a couple of relocations. It also allowed him to retire 11 years later in 2012 when the economy was still in the tank and work was no longer fun.

I've benefited in that we were able to relocate for his job with no pressure on me to find high paying employment. I was able to volunteer full time in the community for my passion, parklands and open space. I was also able to be with my mom the month before she died. Not everyone gets that time.
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Gnirk
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Re: Did any inheritance make positive effect on your life?

Post by Gnirk »

I too, feel an overwhelming responsibility to take good care of my inheritance, and manage it responsibly.
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MN-Investor
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Re: Did any inheritance make positive effect on your life?

Post by MN-Investor »

My husband and I received a 6-figure inheritance from his bachelor uncle. We were already in our mid-50s and were on track with our savings so it just added to our retirement portfolio.

My sister-in-law also received >$100K from this uncle. For her, it's meant that she has something more than just social security to live on now.

For two nephews and a niece who also received >$100K, this helped pay for school, vehicles, towards a house, whatever. They were responsible 20-somethings when they inherited the money and they made good decisions.

As for my estate... my sweetie passed away two years ago and we had no children, so I'm using some of our money now to help out a couple of family members. I also funded two Roth IRAs for two nieces and I will do some IRA fund matching for them to get them started on investing for retirement. My husband had four grand nephews and nieces, the oldest being 16. I plan on helping out with their college educations.
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shepherd
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Re: Did any inheritance make positive effect on your life?

Post by shepherd »

Father became fairly wealthy when his company was sold back in the mid-80's when I was a teenager. He slowly provided annual gifts of $1k to my sister and I starting in our mid twenty's. This increased to $10-20k into our early thirty's. From mid thirty's until his death in 2017 the gifts ranged from $30 to $50k to our families. These gifts allowed one spouse to stay home and raise the children and allowed us to avoid debt throughout our lifetimes. This was never stated but I think it was important to him that my wife focused on raising the kids as both of his parents had worked full time. Between those gifts and the 529s he set up we probably each received about $1m prior to his death. I think the key was that the gifts were provided at the right time of life so that we never wasted the money and I never felt that it affected our ambition as the gifts were never guaranteed. My mother disclaimed part of his IRA at his death which allowed her to continue gifting at the same level going forward. The goal now is to manage below the estate tax level and set the next generation on a successful path as well.

I also feel a strong responsibility to do something similar for my children but to also educate them that they should view inheritance as something to use wisely but also to grow and pay forward to the next generation if possible. Of course this is coming from someone that would like to add a requirement to my will that each child passes the series 65 prior to receiving any inheritance. My challenge is that I am not a spender and love to see balances grow. The succeeding generations may not care as much so I need to balance how much I choose to save for them vs enjoy for my wife and I.
fyre4ce
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Re: Did any inheritance make positive effect on your life?

Post by fyre4ce »

FIREchief wrote: Mon Aug 17, 2020 1:33 am So you have combined income of $500K and you can't afford a decent place to live? :confused
neverpanic wrote: Mon Aug 17, 2020 3:42 am Sounds like time for a new thread to convince fyre4ce to go buy a decent home so the family can stretch out and grow. :wink:

fyre4ce - Disregard if this is too personal (which means I already know it's too personal), but if your wife were to take a year off, would her job be there at the same earning level when she returned? Or is she limited to taking 6-12 weeks unpaid maternity leave in order to retain her position? $2M is a lot, but financially, you have the means to do it, IMO, as it seems you're realistic about what a future inheritance may look like. It's my lowly opinion that the only reason to forestall the move is if it's likely your wife's income would go to $0 after the birth of your next child.
I don't want to hijack this thread with one about my housing (I have posted other threads on this topic here and here) but I will say a few things:

Spouse is an independent contractor in healthcare, and gets paid for both management work (which can be done remotely) and also work in the hospital. "Full" income is about $350k ($500k household), which she earned in 2018 while child-less. In 2019 she earned about $250k with maternity leave. For a variety of reasons the pandemic will probably reduce her future income a bit, and she also has a desire to work slightly less due to the child at home. We are also concerned about her working in the hospital treating COVID patients while pregnant, so I ran some numbers that say if she took 12 months off from hospital work next year and did only management work from home, we would drain our non-retirement assets down to 0 if we bought a $2.1M house today. This is a conservative case but certainly not ridiculous. Her job will definitely be secure if she took a year off.

In any case, we probably can "afford" a $2.0M house, but it's making us both very uncomfortable because it's far closer to the limit of affordability than anything else we've ever bought. Under the circumstances it's probably the right thing to do. An extra $500k in cash would make this purchase much more comfortable. Shocking as it sounds, it's been hard to find a suitable place even though we've been actively looking for months. Inventories are low, demand is high, and the houses in this area are all old and quirky so it's hard to find one we both like. We went after a cheaper place ($1.3M) in a less desirable neighborhood last week, bid $100k over asking, didn't get it- there were 13 offers, and someone went $150k over with a cash offer. So even with everything lined up, sometimes it takes a while to get.
getthatmarshmallow
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Re: Did any inheritance make positive effect on your life?

Post by getthatmarshmallow »

I won't be receiving any kind of inheritance, and I'll count it as a win if I don't need to bail out my parents. Grew up middle-classish but insecure; not all small business owners should be. While I'm glad I have a strong work ethic and grit, I think I'd probably be OK with someone giving me a lot of money now, too.

Most of my college friends are from families that have money, and most of them have nicer stuff than I do because their parents gave them cars, down payments, paid their rents, paid off college, etc. I guess it's supposed to come at a cost, but most of theml seem to have decent work ethics and grit *and* nice things, and when they don't, it doesn't matter, because their parents have money.
jnightingale73
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Re: Did any inheritance make positive effect on your life?

Post by jnightingale73 »

Gnirk wrote: Mon Aug 17, 2020 11:10 am I too, feel an overwhelming responsibility to take good care of my inheritance, and manage it responsibly.
That cant be emphasized enough. My wife and I feel very blessed that my parents were smart and fortunate enough to save and build an inheritance for their two kids. We aren't going out blowing the money on sports cars and huge houses, and rather, saving some and using some to pay down debt, to put us in a better position for eventual retirement as well.
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augryphon
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Re: Did any inheritance make positive effect on your life?

Post by augryphon »

From my parents Inherited a strong faith, focused worth ethic, an appreciation of the value of education, a love of family, and a passion to pass these qualities to my heirs. Financially, what was left at the end of their lives was a few thousand dollars which helped a young family member with a home down payment.

Did it make a positive effect on my life? You bet your sweet azz it did!!
rich126
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Re: Did any inheritance make positive effect on your life?

Post by rich126 »

I've never planned on an inheritance. I was shocked that I got some money ( well under $100K) from a grandmother who passed away years ago. I simply rolled it into my brokerage account and was thankful for the boost in savings. Certainly nothing life changing.

Most likely I will get something from my father, but it is also possible he could out live me. I also have another relative who has no family except for my brother and I (nephews) so it is possible we could get a larger sum from him (he has done an excellent job of investing). It is also possible he could outlive us, or decide to give it to charities or some other person we aren't aware of. It really isn't my business.

I was fortunate that my parents paid for my education and once I graduated my goal was never to need to rely on anyone else for my needs and thankfully I've done that. I'm sure if I needed something they would have helped but honestly, I could never imagine asking for help, just isn't my thing (nor was my father's thing either).

Hopefully if I got some larger amount of money, I'd use it for a good retirement and slowly use it for good charities and helping others. If I knew for sure I was getting some money, I'd be tempted to retire now since I'm already close to retiring and that would ensure it.

I have to admit to seeing a lot of trust funds, inheritances being blown on stuff, especially here in Scottsdale.
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JaneyLH
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Re: Did any inheritance make positive effect on your life?

Post by JaneyLH »

I got enough to buy my first home as a 22 year-old in the SF Bay Area. Subsequently cycled through another 6 homes over 20 years and cashed out with $750K profit, which I used to purchase a beautiful home in a resort area for cash. Not having a mortgage allowed me to live through the 2000 tech crash, losing my job and the value of a lot of my stock options, and recover very nicely. Yes, it made a tremendous difference in my life.
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Re: Did any inheritance make positive effect on your life?

Post by marti038 »

Not to hijack the the thread (which has been very interesting), but I have two questions that have gone largely unaddressed thus far. I wonder if anyone would be willing to humor me:

1) As the one leaving an inheritance to your children, would it help to know more about their level of financial stability to help you with your own planning/spending?

- and -

2) Have any of you that began distributing your wealth to your heirs (assuming children again) before your death had any regrets about doing so?

I ask because I believe my parents and in-laws think DW and I are in good shape financially, but they probably have no idea that our net worth is just north of $1M. We are in our 30s and an inheritance isn't really going to change much for us at this point. It would probably all go into savings/donations/investments/529s/etc. They have all made comments about wanting to leave something to us, which I find honorable, but not really necessary.
vbede772
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Re: Did any inheritance make positive effect on your life?

Post by vbede772 »

When I was 8 my grandmother died. I received $600, which my parents put in a savings account and gave me a passbook. After some months my Dad took me to the bank to update my passbook with the interest received. The teller took the passbook, stamped it, and gave it back to me. I may have had $615 after that, and I was enthralled. I never stopped saving and investing after that.

Maybe some other event would have had the same effect. But that $600 inheritance had a major positive effect on my life.
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Re: Did any inheritance make positive effect on your life?

Post by sailaway »

marti038 wrote: Mon Aug 17, 2020 2:55 pm Not to hijack the the thread (which has been very interesting), but I have two questions that have gone largely unaddressed thus far. I wonder if anyone would be willing to humor me:

1) As the one leaving an inheritance to your children, would it help to know more about their level of financial stability to help you with your own planning/spending?

- and -

2) Have any of you that began distributing your wealth to your heirs (assuming children again) before your death had any regrets about doing so?

I ask because I believe my parents and in-laws think DW and I are in good shape financially, but they probably have no idea that our net worth is just north of $1M. We are in our 30s and an inheritance isn't really going to change much for us at this point. It would probably all go into savings/donations/investments/529s/etc. They have all made comments about wanting to leave something to us, which I find honorable, but not really necessary.
Not what you asked, but we have out and out told the in laws, who are concerned about leaving a legacy, that we don't need an inheritance. For one thing, we felt they needed to know that we are fine so that they don't worry about us financially when we start slow travel. Moreover, they have a bevvy of grandchildren and one child living paycheck to paycheck who is not saving for retirement. Any inheritance is going to have a bigger impact there. Of course, they worry about how those folks would handle it, whereas they know DH can handle money just fine...
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Re: Did any inheritance make positive effect on your life?

Post by neverpanic »

sailaway wrote: Mon Aug 17, 2020 3:04 pm one child living paycheck to paycheck who is not saving for retirement. Any inheritance is going to have a bigger impact there. Of course, they worry about how those folks would handle it, whereas they know DH can handle money just fine...
I've read mixed opinions about scheduled distributions here, even with respect to HEMS, but as I get older, I feel I'm becoming stricter about not being an enabler, while also wanting to make sure that resources are properly directed if the family has a need.
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Re: Did any inheritance make positive effect on your life?

Post by stoptothink »

marti038 wrote: Mon Aug 17, 2020 2:55 pm I ask because I believe my parents and in-laws think DW and I are in good shape financially, but they probably have no idea that our net worth is just north of $1M. We are in our 30s and an inheritance isn't really going to change much for us at this point. It would probably all go into savings/donations/investments/529s/etc. They have all made comments about wanting to leave something to us, which I find honorable, but not really necessary.
My in-laws are early 60's with net worth -$300k+ (FILs studen't loans) and expecting very meager SS, and have not been shy in stating that we are their retirement plan. FIL has made enough recently that at least they haven't had to live with us in ~18 months. Last night we had them over for dinner and he asked if we were ready for him to quit his job yet. I'm sure it was a joke, but it didn't have the intended effect: the wife and I just stared at each other in silence for several seconds.
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FIREchief
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Re: Did any inheritance make positive effect on your life?

Post by FIREchief »

sailaway wrote: Mon Aug 17, 2020 3:04 pm Not what you asked, but we have out and out told the in laws, who are concerned about leaving a legacy, that we don't need an inheritance.
Count your blessings brother! :sharebeer

I know a person whose very own mother told them that she wished she could be buried with her money so that she didn't have to leave it to somebody else. At that point it was suggested to her that she just leave it to charity. She didn't like that idea either.... :shock:
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FIREchief
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Re: Did any inheritance make positive effect on your life?

Post by FIREchief »

neverpanic wrote: Mon Aug 17, 2020 3:14 pm
sailaway wrote: Mon Aug 17, 2020 3:04 pm one child living paycheck to paycheck who is not saving for retirement. Any inheritance is going to have a bigger impact there. Of course, they worry about how those folks would handle it, whereas they know DH can handle money just fine...
I've read mixed opinions about scheduled distributions here, even with respect to HEMS, but as I get older, I feel I'm becoming stricter about not being an enabler, while also wanting to make sure that resources are properly directed if the family has a need.
I would like to be an enabler. I would like to do anything I can to enable my kids to live happy, healthy, safe, productive lives; regardless of whether I'm six feet over or six feet under God's green earth. 8-)
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stoptothink
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Re: Did any inheritance make positive effect on your life?

Post by stoptothink »

FIREchief wrote: Mon Aug 17, 2020 3:46 pm
neverpanic wrote: Mon Aug 17, 2020 3:14 pm
sailaway wrote: Mon Aug 17, 2020 3:04 pm one child living paycheck to paycheck who is not saving for retirement. Any inheritance is going to have a bigger impact there. Of course, they worry about how those folks would handle it, whereas they know DH can handle money just fine...
I've read mixed opinions about scheduled distributions here, even with respect to HEMS, but as I get older, I feel I'm becoming stricter about not being an enabler, while also wanting to make sure that resources are properly directed if the family has a need.
I would like to be an enabler. I would like to do anything I can to enable my kids to live happy, healthy, safe, productive lives; regardless of whether I'm six feet over or six feet under God's green earth. 8-)
I am progressively moving in this direction. At first we were adamant that the kids would pay their own way through school (as we had), unless we had FIRE money...7yrs later our kids, going into 3rd grade and kindergarten, already have undergrad covered and we haven't stopped the funding. More recently, wife and I set a goal that I would buy a ridiculous gadget ($5k e-assist fat bike) when we hit a certain financial target. We hit it earlier this year and all I kept thinking was how much good $5k would do for my kids in the future. She made me promise that I'd pull the trigger when we hit another goal (almost assuredly in the next 12-18 months), but I don't think I'll be able to do it. I just think I am very content with our current life and fancier gadgets or vacations would just stress me out.
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Re: Did any inheritance make positive effect on your life?

Post by flyingaway »

marti038 wrote: Mon Aug 17, 2020 2:55 pm Not to hijack the the thread (which has been very interesting), but I have two questions that have gone largely unaddressed thus far. I wonder if anyone would be willing to humor me:

1) As the one leaving an inheritance to your children, would it help to know more about their level of financial stability to help you with your own planning/spending?

- and -

2) Have any of you that began distributing your wealth to your heirs (assuming children again) before your death had any regrets about doing so?

I ask because I believe my parents and in-laws think DW and I are in good shape financially, but they probably have no idea that our net worth is just north of $1M. We are in our 30s and an inheritance isn't really going to change much for us at this point. It would probably all go into savings/donations/investments/529s/etc. They have all made comments about wanting to leave something to us, which I find honorable, but not really necessary.
How about a $2M inheritance? Would that change something for you?
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Re: Did any inheritance make positive effect on your life?

Post by Carefreeap »

FIREchief wrote: Mon Aug 17, 2020 3:43 pm
sailaway wrote: Mon Aug 17, 2020 3:04 pm Not what you asked, but we have out and out told the in laws, who are concerned about leaving a legacy, that we don't need an inheritance.
Count your blessings brother! :sharebeer

I know a person whose very own mother told them that she wished she could be buried with her money so that she didn't have to leave it to somebody else. At that point it was suggested to her that she just leave it to charity. She didn't like that idea either.... :shock:
It really takes the wind out of their sails when you let them know they can't manipulate you with their money. :wink:
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Matahari
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Re: Did any inheritance make positive effect on your life?

Post by Matahari »

OP, yes. But not in the monetary sense.

When the occasion arose, it prompted me to learn in earnest the estate tax system so that I could make better plans for ourselves. Also, I saw firsthand what an ungodly mess of records and possessions people can leave behind for their survivors to clean out. That prompted me to purge and streamline continually.

The individuals who benefited financially from the inheritance in question were the ones who needed it, us having disclaimed, and they are young enough to have time on their side to make gains over decades.
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FIREchief
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Re: Did any inheritance make positive effect on your life?

Post by FIREchief »

stoptothink wrote: Mon Aug 17, 2020 4:05 pm I just think I am very content with our current life and fancier gadgets or vacations would just stress me out.
Congratulations!! You've achieved something that many/most in this Country may never get close to. Have a (reasonably priced) one on me! :sharebeer
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FIREchief
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Re: Did any inheritance make positive effect on your life?

Post by FIREchief »

Carefreeap wrote: Mon Aug 17, 2020 4:17 pm
FIREchief wrote: Mon Aug 17, 2020 3:43 pm
sailaway wrote: Mon Aug 17, 2020 3:04 pm Not what you asked, but we have out and out told the in laws, who are concerned about leaving a legacy, that we don't need an inheritance.
Count your blessings brother! :sharebeer

I know a person whose very own mother told them that she wished she could be buried with her money so that she didn't have to leave it to somebody else. At that point it was suggested to her that she just leave it to charity. She didn't like that idea either.... :shock:
It really takes the wind out of their sails when you let them know they can't manipulate you with their money. :wink:
LOL. Yeah, that's probably what it was. The ironic thing is that in the situation described, if the mother actually knew the net worth of the intended non-recipient, she would likely have rolled over in her (cash stuffed) coffin. :twisted:
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FIREchief
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Re: Did any inheritance make positive effect on your life?

Post by FIREchief »

Matahari wrote: Mon Aug 17, 2020 4:33 pm Also, I saw firsthand what an ungodly mess of records and possessions people can leave behind for their survivors to clean out. That prompted me to purge and streamline continually.
If only everybody embraced this approach. :beer We've been on a similar journey, having downsized from a large family home to a two bedroom rental in early 2009 (we even had an interesting Bogleheads thread about my journey at the time :P ). Now it makes me nervous when I figure out that I have a few more files that I should be shredding. At that time, it was a five drawer file cabinet and about a half dozen bankers boxes in the garage. Yikes!!! :twisted:
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bloom2708
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Re: Did any inheritance make positive effect on your life?

Post by bloom2708 »

Inheritance can certainly have a positive effect.

We received ~$100k from my grandparents several years back.

We front loaded 3 college educations with that money. 2nd kid is about to start college.

Hopefully we can pay it all and none graduate with any loans.
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adam1712
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Re: Did any inheritance make positive effect on your life?

Post by adam1712 »

Several of my great grandparents came to the USA with an inheritance. For the most part, the next 3 generations have all left more inheritance than they were given. Most of it farmland. The inheritance has helped most in my generation not have to worry about paying for college. It’s also provided us a lot of flexibility to pursue careers we’re passionate about and often have an entrepreneurial spirit. For my 2 siblings and myself, I’d say we’re well on our way to financial independence and would easily get there without the inheritance but the inheritance has made it easier.

My family is very close with lots of entangled business arrangements. It always seemed very natural to me but this board has shown me it’s not the norm. I think farming has played a big part in how my family operates. Now that less than half of my cousins are in agriculture, it will be interesting to see if the future is different.
delamer
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Re: Did any inheritance make positive effect on your life?

Post by delamer »

marti038 wrote: Mon Aug 17, 2020 2:55 pm Not to hijack the the thread (which has been very interesting), but I have two questions that have gone largely unaddressed thus far. I wonder if anyone would be willing to humor me:

1) As the one leaving an inheritance to your children, would it help to know more about their level of financial stability to help you with your own planning/spending?

- and -

2) Have any of you that began distributing your wealth to your heirs (assuming children again) before your death had any regrets about doing so?

I ask because I believe my parents and in-laws think DW and I are in good shape financially, but they probably have no idea that our net worth is just north of $1M. We are in our 30s and an inheritance isn't really going to change much for us at this point. It would probably all go into savings/donations/investments/529s/etc. They have all made comments about wanting to leave something to us, which I find honorable, but not really necessary.

We spend as we like and the kids will split what’s left. Although we have begun gifting money — a car post-college and IRA contributions so far, with plans to give a house downpayment and 529 contributions for (future) grandchildren.

If one of our children became disabled, or had a disabled child or spouse, that might change our plans.

As I noted earlier, I inherited a lot of money in my early 60’s. Smaller amounts gifted earlier would have had a bigger impact. Now the inheritance account is where the gifts to the kids come from, though, so it worked out OK. :)
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Re: Did any inheritance make positive effect on your life?

Post by pahkcah »

When my father passed away my three siblings and I each received a small amount of cash and 1/4 of the house my parents had owned. Prior to the home being sold, DW and I legally transferred our share of the house to my sister (a nurse) who had cared for my father for several years preceding his death. We knew my sister wanted to buy her own home, which would not have been possible without the extra bump.

When my DW's mother passed away, we inherited a little cash and 1/3 of a small home. When the home was sold, we gave our proceeds to DW's brother who we knew could really use the money, as he was trying to buy a home as well.

DW and I have been very fortunate, so we used our inheritances to make a positive impact on others. :happy
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Re: Did any inheritance make positive effect on your life?

Post by NotWhoYouThink »

bertilak wrote: Sat Aug 15, 2020 1:57 pm Receiving an inheritance gave me a sense of responsibility. I felt (and still feel) the money belongs to the family and I need to manage it responsibly.
I don't want my kids to feel any such sense of obligation. I hope they spend it and enjoy it. If it buys them a bigger house or more interesting vacations or an earlier retirement I hope they enjoy those things and don't feel guilty about spending "my" money, or obligated to preserve it or pass it on. The last thing I want to leave them is a burden.
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Re: Did any inheritance make positive effect on your life?

Post by sschoe2 »

I was living with my ailing mom in the family home until she passed in 2018. I received $82k and a lot of the tools and yard equipment and a bit of furniture. I bought my own smaller house and the inheritance helped but it wasn't life changing.
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Re: Did any inheritance make positive effect on your life?

Post by marti038 »

flyingaway wrote: Mon Aug 17, 2020 4:10 pm
marti038 wrote: Mon Aug 17, 2020 2:55 pm Not to hijack the the thread (which has been very interesting), but I have two questions that have gone largely unaddressed thus far. I wonder if anyone would be willing to humor me:

1) As the one leaving an inheritance to your children, would it help to know more about their level of financial stability to help you with your own planning/spending?

- and -

2) Have any of you that began distributing your wealth to your heirs (assuming children again) before your death had any regrets about doing so?

I ask because I believe my parents and in-laws think DW and I are in good shape financially, but they probably have no idea that our net worth is just north of $1M. We are in our 30s and an inheritance isn't really going to change much for us at this point. It would probably all go into savings/donations/investments/529s/etc. They have all made comments about wanting to leave something to us, which I find honorable, but not really necessary.
How about a $2M inheritance? Would that change something for you?
I guess we'd need to start worrying about running into inheritance tax issues for our own estate one day? We'd fund the kid's 529 completely, but we're on track to do that now any way. Maybe we'd take a trip somewhere, but again, we already travel a good bit.

Honestly, I think the biggest change would likely be our giving. We'd certainly be able to do more of it. At this point, I really don't think I'd be any more or less content with more money; it would just be more to think about.
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Doom&Gloom
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Re: Did any inheritance make positive effect on your life?

Post by Doom&Gloom »

marti038 wrote: Mon Aug 17, 2020 2:55 pm Not to hijack the the thread (which has been very interesting), but I have two questions that have gone largely unaddressed thus far. I wonder if anyone would be willing to humor me:

1) As the one leaving an inheritance to your children, would it help to know more about their level of financial stability to help you with your own planning/spending?

- and -

2) Have any of you that began distributing your wealth to your heirs (assuming children again) before your death had any regrets about doing so?

I ask because I believe my parents and in-laws think DW and I are in good shape financially, but they probably have no idea that our net worth is just north of $1M. We are in our 30s and an inheritance isn't really going to change much for us at this point. It would probably all go into savings/donations/investments/529s/etc. They have all made comments about wanting to leave something to us, which I find honorable, but not really necessary.
(1) I am not making an extra effort to leave an inheritance, but I almost certainly will. I have found that my spending patterns and lifestyle are pretty much ingrained. However, if I were reasonably certain that my heirs would squander their inheritance, I would much prefer to squander it myself.

(2) N/A
loukycpa
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Re: Did any inheritance make positive effect on your life?

Post by loukycpa »

My parents are in their 60s. Married over 40 years. Blue collar, hard working all their lives, frugal. Savers not investors. They are too fearful of the stock market to invest there, but they understand and do a good job managing rental property (all single family homes with no leverage). 2007 and then 2012 upon death of grandparents each of my parents inherited some real estate wealth. Approximately $900k total. My dad retired (facility maintenance) a few years ago at 62 (I would consider him part time employed because he manages property). My mom continues to work part time (medical office) mainly to pad her vacation fund. I estimate their net worth at around $2M.

Without question I see it as a tremendous positive and a blessing. It makes me happy to see them comfortable, able to travel some and enjoy life. They deserve it.
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Re: Did any inheritance make positive effect on your life?

Post by softwaregeek »

Parents paid for my school and grad school. Also helped me with the down payment on a two bedroom condo in my mid twenties. I figure that put me about ten years ahead. Maybe more. From that condo I was able to roll the equity into a townhome in an ok school district. Later more money came in my mid thirties. But by that time I was already farther in my career and married with kids so it padded my investments but didn’t change the lifestyle.

Edit: my children are small. But I am already funding their ira and using gift tax exemption to put money in their taxable account. I will have enough for retirement. But they will need it someday to start their lives.
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Re: Did any inheritance make positive effect on your life?

Post by catdude »

I received an inheritance of about $125K from my mom about 13-14 years ago. I was in my early 50's at the time, so had developed good financial habits. It made a positive impact on my life, though not huge. I used a chunk of it to pay off the mortgage on my townhouse, and though I've moved several times since then, I've remained mortgage-free. I used a smaller chunk to make the big leap from a Corolla to a Camry. 8-) The rest of the money I banked for retirement.

I was already well on the way to early retirement, but the inheritance sped up the process. Instead of retiring at 57 or 58, I was able to quit the rat race at 55. Thanks Mom!

I'm quite sure that if I'd gotten that inheritance in my early 20's, I would've blown most if not all of it.
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FIREchief
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Re: Did any inheritance make positive effect on your life?

Post by FIREchief »

softwaregeek wrote: Mon Aug 17, 2020 10:30 pm Edit: my children are small. But I am already funding their ira and using gift tax exemption to put money in their taxable account. I will have enough for retirement. But they will need it someday to start their lives.
How can you fund an IRA for a small child. Do they have earned income?
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: Did any inheritance make positive effect on your life?

Post by steve321 »

I haven't read the whole forum but if this has not been said, one comment I would make is that it's probably helpful to give some money early on to your children, but with no strings attached (provided of course they don't live a dissolute life).
My dad helped me financially early on during my studies, but this came with the pressure of succeeding in a career that he strongly suggested I pursue (because he had not been able to pursue it himself in spite of being one of the most intelligent people I ever knew, because of his material situation earlier on in life).
I'd say if you can give without putting any pressure on your children that's the best course of action.
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Re: Did any inheritance make positive effect on your life?

Post by steve321 »

NotWhoYouThink wrote: Mon Aug 17, 2020 6:43 pm
bertilak wrote: Sat Aug 15, 2020 1:57 pm Receiving an inheritance gave me a sense of responsibility. I felt (and still feel) the money belongs to the family and I need to manage it responsibly.
I don't want my kids to feel any such sense of obligation. I hope they spend it and enjoy it. If it buys them a bigger house or more interesting vacations or an earlier retirement I hope they enjoy those things and don't feel guilty about spending "my" money, or obligated to preserve it or pass it on. The last thing I want to leave them is a burden.
+1 That's a very beautiful thing to say. :happy
Success does not bring happiness. In fact, happiness IS success. | 'There are only two tragedies in life: one is not getting what one wants, and the other is getting it.' Oscar Wilde
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Re: Did any inheritance make positive effect on your life?

Post by SQRT »

steve321 wrote: Tue Aug 18, 2020 4:34 am
I'd say if you can give without putting any pressure on your children that's the best course of action.
Agree. Although I think that, generally, giving money to your children to help with education or a house down payment would reduce financial pressure they might otherwise feel.
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Re: Did any inheritance make positive effect on your life?

Post by vested1 »

SQRT wrote: Tue Aug 18, 2020 6:04 am
steve321 wrote: Tue Aug 18, 2020 4:34 am
I'd say if you can give without putting any pressure on your children that's the best course of action.
Agree. Although I think that, generally, giving money to your children to help with education or a house down payment would reduce financial pressure they might otherwise feel.
+1 for both comments.

I would add that both the giver and the recipient should understand the nature of a gift, in that it comes with no requirements and no strings attached.

I gave my children this lesson soon after my ex-wife and I divorced 29 years ago. Their mom had been using a promised inheritance as a carrot and stick at their tender ages of 6 and 9, threatening even then to cut them off unless they did everything she told them to do.

When, as a result, they asked me what I would be leaving them I told them "Nothing, of course". After the hysterical crying subsided I used the opportunity to explain the process and meaning of a gift. My current wife of 27 years and I have given to our children throughout their lives on an intentionally irregular basis in order to ensure it was not expected. We have always surprised them with these gifts, which have come unasked for with no strings attached. The result has been their healthy attitude concerning expectations, and an appreciation of something that comes from the heart.
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Re: Did any inheritance make positive effect on your life?

Post by SQRT »

vested1 wrote: Tue Aug 18, 2020 6:29 am
SQRT wrote: Tue Aug 18, 2020 6:04 am
steve321 wrote: Tue Aug 18, 2020 4:34 am
I'd say if you can give without putting any pressure on your children that's the best course of action.
Agree. Although I think that, generally, giving money to your children to help with education or a house down payment would reduce financial pressure they might otherwise feel.
+1 for both comments.

I would add that both the giver and the recipient should understand the nature of a gift, in that it comes with no requirements and no strings attached.

My current wife of 27 years and I have given to our children throughout their lives on an intentionally irregular basis in order to ensure it was not expected. We have always surprised them with these gifts, which have come unasked for with no strings attached. The result has been their healthy attitude concerning expectations, and an appreciation of something that comes from the heart.
Exactly! A gift with strings attached is not a gift. Have done the same with my daughter. No strings or loan agreements-straight gifts. Most of the posts in this thread don’t make any mention of “strings” though.
Last edited by SQRT on Tue Aug 18, 2020 11:22 am, edited 1 time in total.
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Re: Did any inheritance make positive effect on your life?

Post by michaeljc70 »

My parents are still alive but believe in giving us part of our inheritance while they are alive. They have been gifting $15k-$20k to each of the 4 kids for several years. I appreciate the money, but don't need it and it makes little difference to my lifestyle. For one sibling it makes a big difference in his life as he has a low paying full time job so the gift is like 50% of what he makes. Two other siblings use the money to lay around the house like deadbeats. They are in their 40s and haven't really held steady jobs for years even though they are completely capable of working.
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Re: Did any inheritance make positive effect on your life?

Post by Carefreeap »

SQRT wrote: Tue Aug 18, 2020 7:08 am
vested1 wrote: Tue Aug 18, 2020 6:29 am
SQRT wrote: Tue Aug 18, 2020 6:04 am
steve321 wrote: Tue Aug 18, 2020 4:34 am
I'd say if you can give without putting any pressure on your children that's the best course of action.
Agree. Although I think that, generally, giving money to your children to help with education or a house down payment would reduce financial pressure they might otherwise feel.
+1 for both comments.

I would add that both the giver and the recipient should understand the nature of a gift, in that it comes with no requirements and no strings attached.

My current wife of 27 years and I have given to our children throughout their lives on an intentionally irregular basis in order to ensure it was not expected. We have always surprised them with these gifts, which have come unasked for with no strings attached. The result has been their healthy attitude concerning expectations, and an appreciation of something that comes from the heart.
Exactly! A gift with strings attached is not a gift. Have done the same with my daughter. Most of the posts in this thread don’t make any mention of “strings” though.
LOL, you haven't heard me talk about my MIL :twisted:

It's great to be in a situation whereby you can't manipulated. :beer
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Re: Did any inheritance make positive effect on your life?

Post by TomatoTomahto »

Carefreeap wrote: Tue Aug 18, 2020 10:00 am LOL, you haven't heard me talk about my MIL :twisted:

It's great to be in a situation whereby you can't manipulated. :beer
I might be wrong, but after years of pulling strings with no advantage gained with us (can’t speak of others in the family), I think MIL has a grudging respect that her daughter is immune. I might be mistaken, but that’s my take.
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Re: Did any inheritance make positive effect on your life?

Post by Bobby206 »

An inheritance made a positive impact on my life by enabling me to pull off the accelerator at work. I was 12+ hour days, 5-6 days a week, worked vacations, was always highly stressed. I inherited enough to work a more normal schedule and take on less stress at work. I think my parents would be very pleased with that outcome as I know they worried about my health due to my stress level. I feel extremely fortunate.

We plan to do similar for our kids one day as well. We have set up our estate and financial plan with the long term goal of being able to help them in life and leave them something one day when we die. However, we have made clear we don't plan to die for a very long time! :)

We also, as I am sure most people here, emphasize hard work, finding a career you enjoy, finding a lifestyle you can afford, and saving some of every paycheck. Preaching to the choir here of course.
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Re: Did any inheritance make positive effect on your life?

Post by bltn »

TomatoTomahto wrote: Mon Aug 17, 2020 10:47 am Our story:

My step-mother imo didn't adhere to my father's wishes as to how his bequest would be carried out when she subsequently died. He had wanted the assets to be split equally between his 3 biological children and 1 step-child. My step-mother instead tilted towards her two biological children (a step sister to me and half-sister (technically anyway, I grew up with her and consider her my sister)). I got a smaller cut and my sister got nothing.

My half-sister was the executor and wasn't happy about the split. She reached out to my step-sister, who didn't want to change anything and opted out of modification. Between the three of us remaining in the mix, my half-sister and I agreed to cut my sister in, more as a matter of decency and courtesy as anything; my inheritance was all of $11k after the adjustment, and nobody "needed" the inheritance.

So, the "positive effect" of the inheritance was that three siblings who had been in limited contact renewed their interactions, All 4 siblings showed their natures.
While the overall effect of this inheritance was positive, at least for three of you, many times an inheritance will cause strains in family relationships. Odd how a bit of money, when divided unevenly, can cause so much rancor.

This emphasizes to me how important it will be to let the children know what to expect , at least in general terms, with their inheritance. Things are planned to be divided evenly for my children.
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Re: Did any inheritance make positive effect on your life?

Post by goodenyou »

I don't think so for us. Our inheritance will come after we have far exceeded our financial needs. Although it is likely to be a very significant amount, it won't change how we live our lives It will change how much we pass to our children, however. After a certain point, there is a diminishing value of consumption. We are fortunate to be below a 2% SWR, and I don't see us going on a spending spree. Our inheritance is coming from very frugal parents on both sides, and I wouldn't dishonor them by squandering their savings.

One point that I don't think has been brought up is the situation when one sibling is very financially well-off and the other(s) may not be (by a significant amount). I wonder if others have faced this situation as the wealthy recipient or the less well off recipient of an inheritance and how they handled it. I have seen some bad situations when this happened (and it was the spouse of the sibling to blame).
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