inheritance money?

[Khan]

I don't recall if I told this story before:

My aunt 'S' (never married or had children, had a long career as a nurse, WW2 veteran) wanted to leave an inheritance to my sister 'N'. Every now and then 'N' would get papers to be signed and notarized.

'S' lived to be 89 in an assisted care facility; sometimes 'N' sent money for things such as 'S' caretaker's glasses.

A few months after 'S' died, 'N' received her inheritance: a box full of papers and photos.

And concerning our parents: they had a reverse mortgage, so much for that house on the canal.

Do not read in any bitterness or jealousy, we never were expecting or depending on an inheritance. They earned the money, raised us, and deserved to spend it all on themselves.

[pureaboly]

Originally Posted by Keyboard Ninja

Who would I consult when this does happen?

Your folks probably have some or all of

* medical decision maker (possibly you)
* power of attorney designee (possibly you)
* minister / pastor / rabbi / spiritual guide
* estate attorney
* executor named in the will (possibly you as well)
* accountant
* investment advisor

It'd be a good idea to introduce yourself to these people as they'll be the people you work with as your parents reach the end of their lives. Assuming your parents are healthy and not about to keel over anytime soon, there's no rush to meet them esp since they may change over time.

You should definitely speak frankly with your parents about the level of care that they want (and vice versa) at end of life. Unless they die suddenly eg plane crash, it's likely that there will be a time that they are incapacitated and you (or the surviving spouse, or the designated medical decision maker) will have to decide what life-sustaining medical treatment, if any, they will receive. Especially with the increasing incidence of senile dementias like Alzheimers & vascular dementia, you may wind up with a recurring decision-making and/or care-taking role. You'll be ill-prepared to do that unless you know what kind of care they would choose for themselves.

[Want2retire]

Originally Posted by Khan

I don't recall if I told this story before:

My aunt 'S' (never married or had children, had a long career as a nurse, WW2 veteran) wanted to leave an inheritance to my sister 'N'. Every now and then 'N' would get papers to be signed and notarized.

'S' lived to be 89 in an assisted care facility; sometimes 'N' sent money for things such as 'S' caretaker's glasses.

A few months after 'S' died, 'N' received her inheritance: a box full of papers and photos.

And concerning our parents: they had a reverse mortgage, so much for that house on the canal.

Do not read in any bitterness or jealousy, we never were expecting or depending on an inheritance. They earned the money, raised us, and deserved to spend it all on themselves.

What a great story! I can really relate to the last paragraph. We felt the same way about our parents' money. They worked hard for it and we encouraged them to spend it on themselves. They did so, to some extent. As for the house, my mother sold our beachfront home on Oahu long before the real estate bubble when she moved into a facility. So, proceeds from the house played only a minor role in her portfolio.

Luckily for us, there was enough remaining in her estate to provide heirs with a whole lot more than a box of papers. But if there hadn't been anything left, I think we would have been OK with that, too.

She was happy, active, and glad to be alive every day up to the middle her 97th year, at the end of which she passed away.

There's a mentality that I think we all have to some extent, which is that if we receive a lump sum of "x dollars" all our problems will be solved. You see this on game shows, when someone wins $20K and goes nuts. They probably wouldn't be as thrilled if they realized that after taxes on the prize and on investment returns, at a 4% SWR they might net less than $40.00/month from their winnings.

We may think that money will solve all problems, but as Khan and some others here know, there is more to life than money. Also, when it comes to solving financial problems I think that by LBYM we are giving ourselves a far greater gift than most heirs receive.

[OAG]

IMHO inherited money is "found" money and usually (in a very lot of cases) just wasted! We got here with nothing and should endeavor to leave the same way (IMO).

[CuppaJoe]

Originally Posted by Keyboard Ninja

I know that this is going to happen someday....

Wow! That is some premise!

[Walt34]

Originally Posted by Want2retire

I can really relate to the last paragraph. We felt the same way about our parents' money. They worked hard for it and we encouraged them to spend it on themselves. They did so, to some extent.

That happened with us (three kids) as well. Always frugal, at one time my mother was concerned about some purchases (new car, some travel) and voiced the concern that she would perhaps not leave an inheritance.

All three were unanimous: "Spend it Mom! Lord knows you've paid your dues!"

[Achiever51]

DH has a very similar story to Khan's. His Aunt Emma never married and spent her entire career with one employer, where she rose to a senior managment position. She retired at age 62 and lived to 90. Shortly after she retired, she let her future heirs (her nephew my husband, and five or six distant cousins, none of whom lived within a thousand miles) know that "someday, everything would be theirs." As she lived close by and DH was to be her personal representative, we had a good understanding of what that "everything" really meant. The others apparently thought they were in line to become instant millionaires.

For the first twenty years of her retirement, Aunt Emma really enjoyed her retirement -- traveling around the world with friends, splurging on a few luxuries, etc. -- and it was wonderful to see her so happy. In her last years, however, some significant health issues forced her to move to an assisted living facility and by the time she died, her "everything" was valued at less than $25,000.

At her death, the distant relatives demanded their shares of the "hundreds of thousands of dollars" that Aunt Emma "must have had." (After all, they pointed out, she did live a pretty high-flying life." Or so they thought from her postcards and notes.) After the audit of her estate, when DH notified the other heirs that their shares would be less than $5K each, one of the cousins filed a formal complaint with the probate court, claimed we siphoned off assets, etc. [In reality, toward the end of her life, we were supplementing her income to pay her bills.] DH ended up resigning as personal rep of the estate...the squabble among the other heirs went on for several years...and in the end, no one got anything as the small estate was spent on attorney fees, audits, etc.

We ended up with a box of personal papers and a desk that she bought on her first trip to the Orient (which we treasure)...everyone else got nothing but hard feelings.

Moral: I never would count on any inheritance until the check cleared.

[Want2retire]

Originally Posted by Achiever51

In her last years, however, some significant health issues forced her to move to an assisted living facility and by the time she died, her "everything" was valued at less than $25,000.

I think this also points out something that a lot of people really don't understand or believe, especially if they have only been around people who died by suddenly dropping dead at 70 or 80 while in great health. Just because a person has a large estate at age 70 doesn't mean the estate will be larger at age 100 if they live that long, due to assisted living and end of life costs or other factors. Although in some or possibly even most circumstances very old age means spending less, in other circumstances it can be costly.

[lazygood4nothinbum]

mom left not a lot but enough so i don't have to work. my spending has not changed at all and i plan to reduce my cost of living in any case. personally, i preferred the life i had when i was working and mom held onto her money. the problem now is that were i to take a job i'd only have half my life back but no amount of money in the world can bring me back the part i'd prefer.

don't worry about feeling guilty about taking your parents' money. there is so much more to deal with, the money won't matter one bit.

[pureaboly]

Originally Posted by Achiever51

Moral: I never would count on any inheritance until the check cleared.

There's an article today in the New York Times (free login probably required) encouraging this approach. It lists eight factors.

http://www.nytimes.com/2008/06/21/bu...hp&oref=slogin

[Bimmerbill]

I tell my mother all the time to spend it! My dad and her saved a long time and then my dad died from cancer at 69 and left it all to my mom.

[P.S.]

a few more stories to add:

when I was very young, my mom had a colleague that also became a close friend. I liked this colleague very much b/c when she would visit, she would always give us beautiful classic books (I still have them). And she also gave very good life advice. She was single, and despite my mom moving away, etc, then remained very close, visiting each other regularly, she came to my graduations etc. It was upsetting to hear when she died, but I was completely floored when I found out she had left me some money. I was even more amazed when I received the copy of the will to sign and saw how much I got in proportion to various nieces and nephews. Apparently the nieces and nephews were also amazed, b/c almost all of her legacy was bequeathed to local medical institutions, volunteer groups, etc. They had expected to be very very rich.

one of my IL's used to often imply that when mother died, there would be a large inheritance. And there would have been, except that she was very late in life diagnosed with a disease that did not kill her in the 1-2 y expected. Instead, she took a very long time, many years to die, and all medical expenses and very expensive facility care were paid from her estate. Housing alone was $20k a month when she died. No one was left rich by what remained.