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Old 07-12-2017, 11:27 AM   #21
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I notice there are a lot of these kinds of articles lately. Dumb and dumber. Either that it's for shock value.
I expect some of these pieces are written by folks selling annuities. "Do your kids a favor and buy an annuity. Save them from a traumatizing lump sum inheritance. You'll have more money to safely spend every month for as long as you live--you can give them gifts while you are living. And, you can help me buy my new boat!"
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Old 07-12-2017, 12:15 PM   #22
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How often do "kids" actually inherit while they're young enough for this to be a concern? My parents were each over 60 before their last living parents died. DH and I are in our 50s and both our Moms are healthy. Even if the worst should happen and we lose one, we've already retired with enough to live our lives comfortably and I can't see that an inheritance at this age would change our basic personalities or lifelong lbym attitudes. Not that we have Gates/Buffett size fortunes in our families, but even if we did, I think we've proven over the past 30+ years that we can make our own way in the world and handle money responsibly.

Likewise, if we live as long as the previous generations, our daughter is also going to be at or near retirement age before she inherits from us. I doubt if I'll be worrying about her going off the rails at that point in her life.
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Old 07-12-2017, 12:18 PM   #23
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My son, who does not know how to handle money, actually asked us to set up a special needs trust for him that only doles out money in specified increments--because he knows he would blow through a lump sum in no time. That was during one of his more responsible moments. There have been plenty of other times when he suggests we could give him his share of the inheritance now! We told him "that ain't gonna happen!"
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Old 07-12-2017, 12:34 PM   #24
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I've wondered if it might be possible to set up a trust that would just match the kid's earned income every year. He earns a dollar, the trust pays him another one. And maybe half a buck goes into an account that is available when he turns 60 YO. When the trust is paid out, the gravy train stops.
There's no reason it can't be done this way.
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I've heard often that it's not wise to try to manage things from the grave, but . . .
This is true. My guess is that some heirs spend their lives figuring out how to get around the limitations of the trust, and spend lots of money on advisors doing so.

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I really never felt my parents owed me anything after I turned 18. If they'd given it all to my sis, that would have been okay. It was their money.
+1

On this last point DM and I don't agree on how to dispose of her assets. My view is those that need help should get it, she has always felt an even split is best, regardless of need. It's her money, so her wishes will be respected. In the case of my family, though, I think helping my children while we are all still alive is a better approach.

One downside of a large inheritance - as we see with athletes, stare, lottery winners, and others that suddenly receive large amounts of cash, if they don't know how to manage money and are not financially disciplined, that money may not help them at all.
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Old 07-12-2017, 01:48 PM   #25
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...

I've just seen way to many people who were raised what we would call "normal" etc, etc. lose their ever loving minds when large sums of money came into play.

the thing is, here on these forums everyone is perfect. everyone's kids are financially smart, would never blow money on a disney vacation and lbtm's. I have found that a lot of forums do not reflect the general population. My friend is a family lawyer and she makes a very good living off of families fighting over money.
Luckily (?) no one in my family has never faced this issue. But, it is amazing how some people react even with relatively small sums--particularly when the estate is not well organized. All the childhood slights tend to bubble up decades later.

We run into it occasionally in the context of commercial litigation--there is no way on earth I'd want to do what your friend does. Way too disheartening....
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Old 07-12-2017, 02:05 PM   #26
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It is a source of great pride to my father thatn even given his decent cushion in his retirement, that both of his kids are better off than he is, and don't "need" his money.
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Old 07-12-2017, 02:07 PM   #27
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I was all proud thinking we would leave him a 5 million dollar plus estate(todays value)Till a few months ago he said something about wanting to retire in 1 or 2 years with 6 million in the bank. He wanted my thought on it. After the initial shock wore off I told him I thought 7 million was more secure. He said "OK a cushion is not a bad idea, Ill stay a little longer".
So, you don't think your son can live off $6 million??
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Old 07-12-2017, 02:48 PM   #28
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So, you don't think your son can live off $6 million??
I didnt know what to say,I was in total shock. When I look at my son I see an 8 year year old boy that I took for father and son haircuts. We had the time of our lives playing with toy trains in the apt at Christmas time. Hearing my boy talking about the word millions and retirement at the age of thirty something threw me for a loop. Guess he is a grown man now(but in my minds eye he will always be my little boy). Whether or not anyone can live off of 6 million is the topic for another thread.
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Old 07-12-2017, 03:33 PM   #29
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It's our intention to leave our kids an inheritance, even though they've said we should spend it all. Yes, we know what problems an inheritance can cause (DW and sister no longer talk). While an inheritance was never part of our retirement plan, control and money can bring out the worst in some. All we can do is hope we raised our kids well enough that an inheritance doesn't come between them.
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Old 07-12-2017, 03:53 PM   #30
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I can speak from some experience. I inherited a significant amount of wealth, but have always had my own goals and followed them through. Dad was a blue collar guy who worked hard and built a very successful construction company that did work all over the world. Parents instilled that there would be no free ride. I knew we had money growing up, but parents always insisted that we find our own way and work for what we wanted. When they passed, the inheritance gave me the opportunity to ER, but I was already doing very well, and happy in my career (architect). Taking ER at a relatively early age (52) was still a difficult choice, as I always felt I should be working. The wealth itself is not the single factor in determining how kids manage it - it's the way they were raised.
Good insight. I totally agree that it's how the kids are raised and perhaps what kind of personality they have. By the time most parents pass away, they have a very good idea as to how their kids will manage any inheritance. Obviously, they can act accordingly.

In my case I have no concern about how my daughter will manage it.
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Old 07-12-2017, 04:23 PM   #31
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.....
And Buffet has already generously funded his kids' respective charitable foundations, which provide secure, lifetime employment for them (& likely their descendants.)
So you think it's great that he has told his kids they have to WORK I'm glad my parents didn't give me a job obligation. Note his kids IF they get paid for running the foundation probably don't get paid when they quit.
Warren has already given over $27 Billion to charities over the past 10 years.
Since he currently is worth $77 Billion, that amounts to 35% of his current wealth,

Anyone who has publicly given more than 35% of their highest wealth amount in the last 10 years, over a 10 year span can feel free to not be a hypocrite.
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Old 07-12-2017, 04:28 PM   #32
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Some folks on ER.org seem to have elevated doing nothing to an art form, and might disagree.


I resemble this remark!
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Old 07-12-2017, 04:34 PM   #33
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Every situation is different. I'm sure there are plenty of people that spend their inheritances responsibly. However, in the 30 plus years that I've working in the trust business, I can tell you there are also plenty of people that would not spend their inheritance responsibly, and a lot of instances where it has caused considerable family discord. And, just because someone is 50 years old, doesn't mean they have the ability to spend wisely.

If you wish to leave $5,000,000 of your hard-earned money to your children, and don't care what they do with it or how it may affect them, then it doesn't matter much, does it? If you do care, then maybe consider a different plan. And for heaven's sake, as the author says, don't put family members in-between other family member's money (that they think is "theirs") and the other family members. Disaster waiting to happen.
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Old 07-12-2017, 05:11 PM   #34
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Every situation is different. I'm sure there are plenty of people that spend their inheritances responsibly. However, in the 30 plus years that I've working in the trust business, I can tell you there are also plenty of people that would not spend their inheritance responsibly, and a lot of instances where it has caused considerable family discord. And, just because someone is 50 years old, doesn't mean they have the ability to spend wisely.

If you wish to leave $5,000,000 of your hard-earned money to your children, and don't care what they do with it or how it may affect them, then it doesn't matter much, does it? If you do care, then maybe consider a different plan. And for heaven's sake, as the author says, don't put family members in-between other family member's money (that they think is "theirs") and the other family members. Disaster waiting to happen.
+1, 30 years in the business,seems like great credentials for me
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Old 07-13-2017, 06:22 AM   #35
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I've heard often that it's not wise to try to manage things from the grave
DD's favorite saying when it came to the inheritance subject

but . . .I really never felt my parents owed me anything after I turned 18. If they'd given it all to my sis, that would have been okay. It was their money.
+1 All that parents "owe" their kids is a start in life and a decent upbringing.
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Old 07-13-2017, 06:38 AM   #36
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I don't have any children but, if I did, I don't think I would feel any different. I don't care what is done with my money after I can't even know what happened to what was once my money.
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Old 07-13-2017, 06:39 AM   #37
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One downside of a large inheritance - as we see with athletes, stare, lottery winners, and others that suddenly receive large amounts of cash, if they don't know how to manage money and are not financially disciplined, that money may not help them at all.
+1

Keith Kellogg - founder of the cereal empire - expressed concern about inherited, unearned wealth by stating that he wanted his sons to develop into "conscientious and truthful young men".

There is something to be said for merit and the manner in which it builds character.
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Old 07-13-2017, 06:43 AM   #38
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There's no reason it can't be done this way.

This is true. My guess is that some heirs spend their lives figuring out how to get around the limitations of the trust, and spend lots of money on advisors doing so.



+1



On this last point DM and I don't agree on how to dispose of her assets. My view is those that need help should get it, she has always felt an even split is best, regardless of need. It's her money, so her wishes will be respected. In the case of my family, though, I think helping my children while we are all still alive is a better approach.



One downside of a large inheritance - as we see with athletes, stare, lottery winners, and others that suddenly receive large amounts of cash, if they don't know how to manage money and are not financially disciplined, that money may not help them at all.


I could never consider anything other than an even split myself regardless of circumstance. My parents make it clear they would not either. I cannot believe anything less would be fair. Why punish the wise.
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Old 07-13-2017, 06:53 AM   #39
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I will not disinherit her because often in our society people equate money with love, and I do not want her to think that for some unknown reason I withdrew my love for her. That would be devastating.[/QUOTE]

There is this. I would have been heart broken had my parents done that to me. (It's been six years now. I didn't touch the money at all except to spend a small life insurance policy to help fund sons' education, and a wedding gift to one of my sons from their grandparents.) It will help me retire a few years earlier. I have no desire to disinherit my children.
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Old 07-13-2017, 07:18 AM   #40
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Right now we are fortunate that our kids are more concerned with us staying alive that with an inheritance .

We will leave some to charity but the majority of whatever we have left we will leave to them. I really do not care what they do with whatever that is. It feels creepy trying to control things from the grave.
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