Planning to receive an inheritance

[Gardener]

I think it is good to have something of a plan. I inherited $90,000 in my early 20's. I would much rather have that person back, than the money, but God didn't offer me that deal. In addition I almost lost my father a few months later in a mugging. Money is nothing compared to family (at least non -toxic family.) I had been reading Your Money or Your Life, and other financial planning books for years. So, while I hadn't expected an inheritance, I had plans for how to manage money. I put 1/3 into a downpayment for a house, 1/3 to go back to school for a better paying career, and 1/3 in an index plan. My brother went through the money within 1 or 2 years, and declared bankruptcy. He owes more on his house than it is worth, mine is worth more and I don't have a mortgage. The point is not to make fun of my brother (who is a great person) it is just to comment that inheritances have to be managed, and some forethought is required for that. Especially if the money is a big amount (relative to what you are living on.) I expect a couple more inheritances in my life, most of them enough to fund a vacation, maybe. One I anticipate being 3 or 4x our yearly income. Of course, the longer that relative lives the better, as he is one of my favorite people in the world.
Gardener

[kumquat]

Quote:

Originally Posted by chinaco The only time you can plan on it... is when the money is in your account. Otherwise, don't factor it into your plans. If it happens... whoopee, you have a windfall.

Planning to retire on an inheritance is similar to planning to retire on a lottery win. OK, maybe inheritance has a slightly better chance of working.

[TomG]

My parents have been completely candid that they expect to leave a sufficient inheritance for me and my sister. It is mindboggling that so many who have built any estate fail to do this

Though hopefully decades away from seeing the bulk of the wealth, I look to it as an asset similar to my health. Great to have, but can slip away at anytime

[homestead]

My grandmother lived to be 102 years , after she died my dad said
she only had 2k dollars left.

[kaudrey]

We have longevity, as well as frugality, in our family (on both my parents' sides). My mother's mother didn't have any money after it all went to years in a nursing home due to Alzheimer's. My dad's parents died well into their 80s, and had a nice house and some money. My sister and I are the heirs to my parents and my aunt (no kids). My parents are 74 and my aunt is 69. I hope they live as long as my grandparents did (at least), and I always encourage them to spend their money as they see fit. After a lifetime of saving, it is hard for all of them to spend! My aunt is getting better at it, though - being more adventurous in traveling around the world. I think they both have portfolios in the low 7-figures, but we dont' talk about specific numbers, and I don't care. I am the executor to all of their wills, and my sister's....I must be the finance person in the family...ugh.

We, as a family, are prepared to deal with the possibility of long-term care and helping each other out. Late-life medical costs may deplete everything, and if it does, I just hope it helps make them all comfortable in the last years. I hope to retire while they are still alive (as my parents and aunt did with their parents).

This is my long-winded way of saying that although I am certain to be remembered in the wills' my close family, I know there are no guarantees in life, and it is not something I think about or plan for. What is important to me is how they live with whatever life throws at them, and that I am there for them when they need me.

[kcowan]

I built a financial plan which had 5 scenarios in it, one of which was to receive two large inheritances. By manipulating the plan, I was able to decide when it was appropriate to buy our place in the sun within our own means.

Before we spent our first year there, MIL passed away from lung cancer. Then last year, my only bro died suddenly. Both inheritance came in "on plan" but our lives have not changed. Bro did give each of my kids $50K and that was very well received.

Would rather have MIL and bro in our lives. But the plan did come together. Of course the plan was constructed in an age of different returns than today so the inheritances provide a welcome buffer.

[BigNick]

I'm bumping this thread, first to say hi, since I haven't been here in a while (mostly busy with school... I have a paper coming out in a couple of months that may become moderately notorious, but it's embargoed for now) and second, to complete the story started by the first post in this thread.

Since July 2010 when I posted this:
- I went back to school (see above)
- I took ER from my job, with a nice payoff; I'm now looking to do a PhD in something esoteric like "philosophy of science"
- My FiL died (heart attack after 8 years of caring daily for MiL)
- My MiL died (the bugs got her, after 8 years of being bedridden)
- My Mom died (massive stroke; it was the way she would have wanted to go, and she knew the risks, having stopped her blood pressure medicine several years earlier because it was seriously messing with her quality of life)

DW and BiL did an awful lot of grieving; I coped with it the way our family has always coped with this kind of thing, i.e., with gritted teeth. Anyway, that process is now at the "no longer getting in the way of daily life" stage and we're ready to move on.

It's taken the best part of a year to sort out the inheritance, despite both wills being ultra-simple (FIL left it all to MIL; MIL left it 50-50 to DW and BiL; my Mom left it 50-50 to me and DS). BiL and DW appointed a specialist company to do the work, about which I was skeptical, but they came recommended (from a newspaper article that highlighted the ripoffs to avoid) and indeed it cost less for them to do MiL's total will than we paid the realtor to sell her house. DS, who lives in the same country as my Mom, did all the procedure herself, with a little help from her DH, and didn't charge a fee to the estate.

Mom left about what I thought she would. In-laws were a revelation; they had a quarter of a million dollars in cash, squirreled away in various accounts. DW is torn between being delighted at what we will receive (most of it is earmarked to help our kids buy houses when the time comes, but there may be a little "fun money") and upset that her parents didn't do more travelling when they could. I ought to point out to her that, unlike us, they weren't big fans of travelling, but I'll keep quiet on that point.

Most people who posted here said "don't count your chickens", and I can honestly say that I didn't. I'm just updating "The Spreadsheet" as the various disbursements come in, and looking at what we'll have in the bank at age 75. The grandkids will probably be able to go to college after all.

[MichaelB]

Hey Bignick, thanks for the update. Condolences for your losses, I can't imagine all that happening in such a short time.

Your kids are fortunate, the grandkids even more so. Don't neglect yourselves, "ungritting" your own teeth is also important.

[Fishingmn]

Quote:

Originally Posted by homestead My grandmother lived to be 102 years , after she died my dad said she only had 2k dollars left.

That's the exact deal my mom and I have. I shouldn't expect any money and she shouldn't run out

[Shanky]

I absolutely do not believe in the concept of inter-generational wealth. The best path would be to settle the estate and give the rest to charity. (of your choice) That way, you know you made your way in this world by merit and without the windfall which you had nothing to do with. You can probably guess, I do not have to worry about receiving an inheritance.

[SumDay]

Wow BigNick, your family has been through it! We went through almost the same scenario beginning in 2008, only we had a little cancer sprinkled in there. That which doesn't kill us makes us stronger....

Personally, I am fond of the idea of leaving a legacy to my kids, but it isn't my primary goal. I want to not eat dog food, and if there's any left over, it will go to the charities specified in our will, with the rest going to the kids. My parents did this for us, and it make a fundamental difference in all our lives. It makes me grateful every single day for their hard work, and the work ethic they instilled in me. I'm sure our parents are looking down on us, happy to know they made such an impact. I hope to do the same one day.

[FANOFJESUS]

Had a relative that was well off about 250k in today's money and all the relatives knew it. We were related to the female she died first. The male after this "thought" he found his relatives in a foreign country. They got all the money off him while he was alive then when the money ran out this woman who said she was his sister talked him into marrying her so she could get social security. These crazy people got the money but we told the social security department and got her deported. This couple is still talked about in our family over 35 years later. All the relatives(8) had planed on an inheritance. It just goes to show anything can happen.

[Free To Canoe]

Quote:

Originally Posted by TromboneAl It doesn't bother anybody else to be discussing counting up the money you're going to get when someone dies? Reminds me of that movie in which the old Italian women are gathered around someone's deathbed waiting to pounce on her possessions as soon as she takes her last breath. Anybody know what movie that was?

Zorba the Greek
I'll never forget that scene.

Zorba the Greek - Wikipedia, the free encyclopedia

[Dawg52]

Thanks for the update BigNick. My mother died recently and although I keep busy, it's not easy getting over the loss of a your Mom. But.....you have to move on and try to live each day to the fullest.

As far as your inheritance goes, enjoy it anyway you so choose. Your Mom and in-laws wanted you to have it.

[W2R]

BigNick, I am so sorry to hear of the passing of so many of your relatives. You have had so much grief to deal with in such a brief time. Glad to hear that your teeth gritting time is passing, and that the time has come to move on.

Quote:

Originally Posted by BigNick I'm just updating "The Spreadsheet" as the various disbursements come in, and looking at what we'll have in the bank at age 75. The grandkids will probably be able to go to college after all.

I was so glad to read that you hadn't counted your chickens. When your disbursements do come in, you will know what you are dealing with.

[donheff]

Quote:

Originally Posted by Shanky I absolutely do not believe in the concept of inter-generational wealth. The best path would be to settle the estate and give the rest to charity. (of your choice) That way, you know you made your way in this world by merit and without the windfall which you had nothing to do with. You can probably guess, I do not have to worry about receiving an inheritance.

Do you have children? Do you have money?

[Shanky]

Quote:

Originally Posted by donheff Do you have children? Do you have money?

Yes (several) & yes.

[REWahoo]

Quote:

Originally Posted by Free To Canoe Zorba the Greek I'll never forget that scene. Zorba the Greek - Wikipedia, the free encyclopedia

Three years after asking the question, T-Al finally gets an answer...

[Htown Harry]

Sorry for your losses, BigNick. Thanks for posting a follow-up.

Shanky's commentary got me to thinking...

Quote:

Originally Posted by Shanky I absolutely do not believe in the concept of inter-generational wealth. The best path would be to settle the estate and give the rest to charity. (of your choice) That way, you know you made your way in this world by merit and without the windfall which you had nothing to do with...

Which led to an evening of surfing through Google terms like: "intergenerational wealth", "bequest motives" and "inheritance attitudes".

I found this paper particularly insightful on the judgments made by all of us as we age and consider our "legacy" in the form of bequests:
Perspectives on intergenerational bequests: Inheritance arrangements and family resources - Family Matters No 88, 2011 - AIFS journal - Publications - Australian Institute of Family Studies

Quote:

Conclusion The financial wellbeing of a family obviously owes much to how its elders use the resources that are available to them. How these resources are passed on is closely tied to norms and expectations about obligation and entitlement. How the older generation exercises its own entitlement is not only a potential source of conflict within the family. It also remains an open question for family researchers. Throughout, the evidence has pointed to the significance of achieving a balanced orientation to inheritance arrangements - a balance in approaches to spending and saving, a balance in judgements about the appropriate divisions of assets, a balance between competing norms. We have already pointed to the attraction of taking a one-sided view of how elders make their inheritance arrangements. [One side of the debate proposes that the current older generation of potential inheritance givers can be seen mostly as "Hedonistic Self-Servers". The other side proposes they can be seen mostly as "Sensible Squirrels".] One-sided views not only fail to take account of the evidence, but they sell short the experiences, demands and norms that pull bequest-makers in different directions. Instead of carefree nomads or benevolent fairy godmothers and godfathers, it may be more useful to think about elders as ageing jugglers. They are juggling their own needs and interests along with the needs and interests of the family. That is a handful in anyone's terms.

This paper - and almost all of the articles I found - focuses on the motives of the bequestor. Shanky's absolutist opinion and advice to the receiver of a bequest is the other side of a coin, I suppose.

So is my opinion:

One-sided views sell short the experiences, demands and norms that pull bequest-receivers in different directions. They are juggling their own needs and interests along with the needs and interests of the bequestor and the intergenerational family.

Do as you please, BigNick.

[Shanky]

Quote:

Originally Posted by Htown Harry Sorry for your losses, BigNick. Thanks for posting a follow-up. Shanky's commentary got me to thinking... Which led to an evening of surfing through Google terms like: "intergenerational wealth", "bequest motives" and "inheritance attitudes". I found this paper particularly insightful on the judgments made by all of us as we age and consider our "legacy" in the form of bequests: Perspectives on intergenerational bequests: Inheritance arrangements and family resources - Family Matters No 88, 2011 - AIFS journal - Publications - Australian Institute of Family Studies This paper - and almost all of the articles I found - focuses on the motives of the bequestor. Shanky's absolutist opinion and advice to the receiver of a bequest is the other side of a coin, I suppose. So is my opinion: One-sided views sell short the experiences, demands and norms that pull bequest-receivers in different directions. They are juggling their own needs and interests along with the needs and interests of the bequestor and the intergenerational family. Do as you please, BigNick.

My opinion is only that. I do not believe the choices should be taken away from either the giver or the recipient. Thanks for the thoughtful response.