Do you take inheritance into account when calculating net worth?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
letsgobobby
Posts: 12113
Joined: Fri Sep 18, 2009 1:10 am

Re: Do you take inheritance into account when calculating net worth?

Post by letsgobobby » Tue Jan 08, 2019 9:59 pm

deleted
Last edited by letsgobobby on Thu Apr 18, 2019 4:48 pm, edited 1 time in total.

michaeljc70
Posts: 5337
Joined: Thu Oct 15, 2015 3:53 pm

Re: Do you take inheritance into account when calculating net worth?

Post by michaeljc70 » Tue Jan 08, 2019 10:00 pm

2015 wrote:
Tue Jan 08, 2019 9:39 pm
dbcooper wrote:
Sun Jan 06, 2019 9:54 pm
Being the new guy here I will put my neck on the chopping block!

Yes I would consider it in some fashion. The amount is not so much the import part its more where its invested. Life is a all a gamble but I plan on telling our kids where a majority of our funds invested at some point when it make sense. It may make a difference where they want to invest their nickles. They are smart enough the know they may not get anything in the end.

...
I've told my brothers and sisters my nieces and nephews will be inheriting my estate but to say nothing at this time as I want to avoid anyone coming over and kicking me down the stairs.
I've always joked (not having any kids) that my potential heirs when not responding favorably to my requests will get the "okay, that's okay. I needed to make time to meet with my attorney to discuss changing my will anyway" remark. :D

michaeljc70
Posts: 5337
Joined: Thu Oct 15, 2015 3:53 pm

Re: Do you take inheritance into account when calculating net worth?

Post by michaeljc70 » Tue Jan 08, 2019 10:25 pm

As I said above, I don't count it as who knows what you will get if anything. My parents are in their early 70s and have started doling money out already. They have been giving $12k-$14k per kid (4 kids) a year. My mother has stated that they don't see any reason to wait until they're dead and they'd rather give the money while living. They have pensions that more than cover all their expenses. Even given that, I don't count on that money. Who knows if the market tanks if they will continue doling it out. If they have major healthcare expenses, maybe they will stop. If one passes, their finances (due to pensions) will be altered. Though $12k/yr won't change my life (I have low 7 figures of savings), I greatly appreciate it at as it covers about 1/4 of my annual expenses.

Grt2bOutdoors
Posts: 20976
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: Do you take inheritance into account when calculating net worth?

Post by Grt2bOutdoors » Wed Jan 09, 2019 12:02 am

GAAP wrote:
Tue Jan 08, 2019 2:21 pm
Would you count future Lotto winnings as part of your net worth?
I would if I had the uncashed ticket in my possession.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

User avatar
DWesterb2iz2
Posts: 126
Joined: Sun Apr 26, 2015 5:27 am

Re: Do you take inheritance into account when calculating net worth?

Post by DWesterb2iz2 » Wed Jan 09, 2019 7:37 am

Reminds me of this:

A 120-Year Lease on Life Outlasts Apartment Heir

Andre-Francois Raffray thought he had a great deal 30 years ago: He would pay a 90-year-old woman 2,500 francs (about $500) a month until she died, then move into her grand apartment in a town Vincent van Gogh once roamed.

But this Christmas, Mr. Raffray died at age 77, having laid out the equivalent of more than $184,000 for an apartment he never got to live in.

On the same day, Jeanne Calment, now listed in the Guinness Book of Records as the world's oldest person at 120, dined on foie gras, duck thighs, cheese and chocolate cake at her nursing home near the sought-after apartment in Arles, northwest of Marseilles in the south of France.

She need not worry about losing income. Although the amount Mr. Raffray already paid is more than twice the apartment's current market value, his widow is obligated to keep sending that monthly check. If Mrs. Calment outlives her, too, then the Raffray children and grandchildren will have to pay.

"In life, one sometimes makes bad deals," Mrs. Calment said on her birthday last Feb. 21.

The apartment is currently unoccupied, according to local media.

https://www.nytimes.com/1995/12/29/worl ... -heir.html

SGM
Posts: 3004
Joined: Wed Mar 23, 2011 4:46 am

Re: Do you take inheritance into account when calculating net worth?

Post by SGM » Wed Jan 09, 2019 9:55 am

You can't count on receiving an inheritance. When I was learning to drive I was promised a car from a relative. He remarried and died early. His new wife kept the car.

SQRT
Posts: 1142
Joined: Sat Feb 05, 2011 9:44 am

Re: Do you take inheritance into account when calculating net worth?

Post by SQRT » Wed Jan 09, 2019 11:35 am

I doubt many would include in a net worth calculation. But there are certainly cases where one might take it into account in some fashion. In my case my MIL has a mid 7 figure portfolio that I manage. She is 90,in good health but doesn’t spend all her income. My wife is her executor. Are we getting an inheritance? Almost certainly but other than in a general sense we don’t think much about it. Not material to our overall financial position in any event.

DesertDiva
Posts: 464
Joined: Thu Mar 01, 2018 12:49 pm
Location: In the desert

Re: Do you take inheritance into account when calculating net worth?

Post by DesertDiva » Wed Jan 09, 2019 3:29 pm

GCD wrote:
Sun Jan 06, 2019 3:34 pm
Someone else's money isn't yours so you can't count it as an asset.
+1,000,000 thumbs up

At a young age, I overheard one of my parents say "we don't have to save money for retirement; our inheritance will be our retirement." At the time, I didn't fully understand the implications of this statement. However I eventually saw how this outlook manifested itself in (1) poor decision making including failure to plan for the future, and (2) lack of concern for my grandparent's welfare in order to preserve an estate.

To make a long story short, my grandparents lived longer than expected, valuables were taken from their home while they were still alive, and their children ultimately received less of an inheritance than they anticipated (and felt they "deserved").

Sad but true. However, I have chosen to learn from this and I have told my family that no one needs to die in order for me to retire.

CurlyDave
Posts: 1133
Joined: Thu Jul 28, 2016 11:37 am

Re: Do you take inheritance into account when calculating net worth?

Post by CurlyDave » Wed Jan 09, 2019 4:08 pm

DesertDiva wrote:
Wed Jan 09, 2019 3:29 pm
GCD wrote:
Sun Jan 06, 2019 3:34 pm
Someone else's money isn't yours so you can't count it as an asset.
+1,000,000 thumbs up

At a young age, I overheard one of my parents say "we don't have to save money for retirement; our inheritance will be our retirement." At the time, I didn't fully understand the implications of this statement. However I eventually saw how this outlook manifested itself in (1) poor decision making including failure to plan for the future, and (2) lack of concern for my grandparent's welfare in order to preserve an estate.

To make a long story short, my grandparents lived longer than expected, valuables were taken from their home while they were still alive, and their children ultimately received less of an inheritance than they anticipated (and felt they "deserved").

Sad but true. However, I have chosen to learn from this and I have told my family that no one needs to die in order for me to retire.
My parents were self-made well off, not wealthy, but a long ways from poor.

My brother planned on an inheritance financing his retirement, and was very disappointed when my father remarried and our stepmother inherited all of the assets.

I acted as though anything I inherited would be a bonus, but that I needed to make provision for my own future. The bonus never came through, but my own provisions have been more than adequate...

DesertDiva
Posts: 464
Joined: Thu Mar 01, 2018 12:49 pm
Location: In the desert

Re: Do you take inheritance into account when calculating net worth?

Post by DesertDiva » Wed Jan 09, 2019 4:15 pm

CurlyDave wrote:
Wed Jan 09, 2019 4:08 pm
DesertDiva wrote:
Wed Jan 09, 2019 3:29 pm
GCD wrote:
Sun Jan 06, 2019 3:34 pm
Someone else's money isn't yours so you can't count it as an asset.
+1,000,000 thumbs up

At a young age, I overheard one of my parents say "we don't have to save money for retirement; our inheritance will be our retirement." At the time, I didn't fully understand the implications of this statement. However I eventually saw how this outlook manifested itself in (1) poor decision making including failure to plan for the future, and (2) lack of concern for my grandparent's welfare in order to preserve an estate.

To make a long story short, my grandparents lived longer than expected, valuables were taken from their home while they were still alive, and their children ultimately received less of an inheritance than they anticipated (and felt they "deserved").

Sad but true. However, I have chosen to learn from this and I have told my family that no one needs to die in order for me to retire.
My parents were self-made well off, not wealthy, but a long ways from poor.

My brother planned on an inheritance financing his retirement, and was very disappointed when my father remarried and our stepmother inherited all of the assets.

I acted as though anything I inherited would be a bonus, but that I needed to make provision for my own future. The bonus never came through, but my own provisions have been more than adequate...
Kudos to you, sir. :sharebeer

stoptothink
Posts: 5905
Joined: Fri Dec 31, 2010 9:53 am

Re: Do you take inheritance into account when calculating net worth?

Post by stoptothink » Wed Jan 09, 2019 4:18 pm

CurlyDave wrote:
Wed Jan 09, 2019 4:08 pm
DesertDiva wrote:
Wed Jan 09, 2019 3:29 pm
GCD wrote:
Sun Jan 06, 2019 3:34 pm
Someone else's money isn't yours so you can't count it as an asset.
+1,000,000 thumbs up

At a young age, I overheard one of my parents say "we don't have to save money for retirement; our inheritance will be our retirement." At the time, I didn't fully understand the implications of this statement. However I eventually saw how this outlook manifested itself in (1) poor decision making including failure to plan for the future, and (2) lack of concern for my grandparent's welfare in order to preserve an estate.

To make a long story short, my grandparents lived longer than expected, valuables were taken from their home while they were still alive, and their children ultimately received less of an inheritance than they anticipated (and felt they "deserved").

Sad but true. However, I have chosen to learn from this and I have told my family that no one needs to die in order for me to retire.
My parents were self-made well off, not wealthy, but a long ways from poor.

My brother planned on an inheritance financing his retirement, and was very disappointed when my father remarried and our stepmother inherited all of the assets.
This is pretty much what happened with my mother. After growing up very wealthy (my grandfather was a very successful physician, who owned a large practice that my mother worked in for nearly 30yrs), she raised 5 children on her own well below the poverty line. After we all left the home, she remarried and had some success in her career. She's made a pretty good living for the past 15yrs, but they have $0 in retirement savings between her and my stepfather. My mother was planning on inheriting a lot of money when my grandfather died, but he remarried a few years before his death and left everything to his 2nd wife. 2nd wife died a handful of years ago and left almost everything (well into 7-figures in cash and two properties worth close to $1m each) to my mother's adopted youngest sister. My mother received nothing. She's approaching 60 and now intending to work until the day she dies...or more likely, being somewhat financially dependent on my wife and I (as my in-laws already are).

User avatar
HomerJ
Posts: 13124
Joined: Fri Jun 06, 2008 12:50 pm

Re: Do you take inheritance into account when calculating net worth?

Post by HomerJ » Wed Jan 09, 2019 4:27 pm

9-year old kid: "Dad, are we rich?"

Dad: "Your Mom and I are well off... YOU are flat broke."
The J stands for Jay

Grt2bOutdoors
Posts: 20976
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: Do you take inheritance into account when calculating net worth?

Post by Grt2bOutdoors » Wed Jan 09, 2019 6:01 pm

HomerJ wrote:
Wed Jan 09, 2019 4:27 pm
9-year old kid: "Dad, are we rich?"

Dad: "Your Mom and I are well off... YOU are flat broke."
Sounds like the line from William Bernstein’s If You Can where he asks his father if they are rich. The response is the parents are comfortably well-off, you don’t have a dime!
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

letsgobobby
Posts: 12113
Joined: Fri Sep 18, 2009 1:10 am

Re: Do you take inheritance into account when calculating net worth?

Post by letsgobobby » Wed Jan 09, 2019 6:09 pm

deleted
Last edited by letsgobobby on Thu Apr 18, 2019 4:48 pm, edited 1 time in total.

acegolfer
Posts: 1443
Joined: Tue Aug 25, 2009 9:40 am

Re: Do you take inheritance into account when calculating net worth?

Post by acegolfer » Thu Jan 10, 2019 10:02 am

BHs don't even have a consensus on whether to include home equity when calculating net worth. So you will get many different perspective on inheritance. See which one applies to you the most and don't feel bad even if it's in the minority.

Personally, I don't take inheritance into account, when calculating net worth. But I take it into account, when making investment/personal finance/life choice decisions.

Bully3000
Posts: 41
Joined: Mon Jan 07, 2019 4:23 pm

Re: Do you take inheritance into account when calculating net worth?

Post by Bully3000 » Thu Jan 10, 2019 12:33 pm

Nope I do not account for any future inheritance or see it as part of my net worth same way I do not account for it or SS as part of my Retirement, anything I get extra is just a bonus.

User avatar
Darth Xanadu
Posts: 684
Joined: Sat Jan 27, 2018 1:47 am
Location: Middle Earth

Re: Do you take inheritance into account when calculating net worth?

Post by Darth Xanadu » Thu Jan 10, 2019 12:53 pm

I for one do not calculate my own net worth. I do, however, regularly update a planning file with account balances. So, I only plug in balances that I see on the computer screen. There are no asterisks.
"A courageous teacher, failure is."

Jack FFR1846
Posts: 9742
Joined: Tue Dec 31, 2013 7:05 am

Re: Do you take inheritance into account when calculating net worth?

Post by Jack FFR1846 » Thu Jan 10, 2019 1:00 pm

My wife's grandparents left a paid for house, savings bonds and bank accounts full of cash. 2 daughters were to split this according to the will. One daughter lived with the grandfather and took care of him. Part of her taking care of him was to coerce him into changing the title on the house and changing the will. When he died, my mother in law got nothing.

There's a good reason why you should not count on getting anything. Because you just might not get anything.
Bogle: Smart Beta is stupid

stoptothink
Posts: 5905
Joined: Fri Dec 31, 2010 9:53 am

Re: Do you take inheritance into account when calculating net worth?

Post by stoptothink » Thu Jan 10, 2019 1:15 pm

Jack FFR1846 wrote:
Thu Jan 10, 2019 1:00 pm
My wife's grandparents left a paid for house, savings bonds and bank accounts full of cash. 2 daughters were to split this according to the will. One daughter lived with the grandfather and took care of him. Part of her taking care of him was to coerce him into changing the title on the house and changing the will. When he died, my mother in law got nothing.

There's a good reason why you should not count on getting anything. Because you just might not get anything.
Similar to what happened with my mom. As soon as my step-grandmother was put into a senior care facility, all of the sudden my mother's youngest (adopted) sister decided to become the best friend of the step-mom she hadn't talked to in over 15yrs. She died a year later and coincidentally my aunt received virtually everything while my mother and her 5 other siblings didn't get a penny. It happens.

Post Reply