What are your plans for your children's inheritance?

[RetireAge50]

Nothing complicated, each child 50% of anything remaining. Probably gonna be $1 million each in today’s dollars regardless of how long we live.

 

[pb4uski]

Why a prepaid funeral? Is there a law requiring your survivors to pay for your funeral?

If nobody steps up, I believe the state will have to cough up for a cremation.

Just the legacy that I want to leave, that I mismanaged my money so the state had to pay for my burial.... no thank you.

 

[yakers]

A bit to charity but mostly what we don't spend goes to our two sons.

 

[Friendish Friends]

Sudden money is hard to handle, fortunately there are some good resources out there about how to plan a gift and how to receive one.

I suggest reading The Cycle of the Gift. Its written by financial advisors who specialise in generational wealth, and it's the only book I've found that goes into the emotional and practical aspects from both a givers and a receivers perspective. While it's likely written with billionaires in mind, lots apply to us in the lower tiers of wealth.

In short, you can't control anyone from the grave, but you can prepare them. If you believe you will leave a life changing amount of money, talk to them about it. Talk about the practical side, but also what the purpose of life is beyond making more money. Is it to be more adventurous? More generous? More luxurious? Figure out what's important to your family and pass that wisdom along.

 

[fasteddie911]

We're in a similar life stage as yourself, and for now we'd just give everything to whoever takes care of our child, and maybe the child will get everything age 25 or something. Too early to say. However, I have been thinking about the bigger picture of how we'll help our child over the years. I work a good job and can afford to sock away a good amount. Retirement takes priority but if possible I plan on giving my child a good amount of financial help if needed. Assuming they have a good head on their shoulders (and I'm not one to believe that helping my child will necessarily spoil them), I don't want my kid(s) to worry about money. These days I see so many of my adult friends stressed and anxious about their jobs and money. I can see how HS or college kids can feel the same way about their future and "making it." I don't want my child to have that lifestyle or worries. What that means for me is paying for their college, helping with a house, leaving funds for their retirement, etc. But who knows what the future holds, we'll see how this plays out in the years to come.

 

[NW-Bound]

Just the legacy that I want to leave, that I mismanaged my money so the state had to pay for my burial.... no thank you.

Before we die, most of us will cost Medicare a lot of money in hospital costs. A lot. What's a few more bucks for the electricity for cremation?


Just joking. As I often do.

 

[Senator]

No kids. I always say, somewhat jokingly, that's some stripper if it may not even be born yet will wind up with the bulk of mine

 

[Floridatennisplayer]

No kids. I always say, somewhat jokingly, that's some stripper if it may not even be born yet will wind up with the bulk of mine

Hilarious! I remember reading years ago about some old guy that left a quarter of his cash to girls at a strip club naming each girl. His family was furious but still lost in court. Bambi, Raven, and Amber got to keep the money.

 

[HFWR]

Hilarious! I remember reading years ago about some old guy that left a quarter of his cash to girls at a strip club naming each girl. His family was furious but still lost in court. Bambi, Raven, and Amber got to keep the money.

I think I helped put them through college!

 

[CardsFan]

DS will get everything when we are both gone. He is 37, responsible, and recently engaged. If there are grand-kids, we will likely fund 529 plans, over time, up to about $150k per kid. Another thought is to leave DS a portion of each of our IRA's, so he gets something when the first one passes, but we have not acted on that one yet.

While we have told him to not count on anything, and he is planning accordingly, the reality is he will inherit enough to comfortably retire (combined with his own), unless we have a major healthcare/LTC issue.

 

[trumpeting_angel]

I will be leaving part to DH (we are not actually married at this time), who has assets of his own, and the rest to DD and her husband and daughter. What’s most important, though, is discussing all this with them now. Planning a meeting with DD and DSIL. DD has concerns about making sure I plan for care; she is my only child and will be stuck if I don’t.

 

[6miths]

Even 4-way split.

 

[pb4uski]

.... DD has concerns about making sure I plan for care; she is my only child and will be stuck if I don’t.

Just make sure that she knows that if your estate is unable to pay that she is not legally responsible for any of your unpaid bills unless she signed off accepting financial responsibility for them. Many unscrulpulous bill collectors twist words to convince family members that they are financially responsible for a loved ones bills when they are not.... tell them to go pound sand.

 

[Brat]

I have a bit of a dilemma. I know that a will communicates more than money (or assets) but one child is very wealthy as a result of her own efforts (grabbing a brass ring employment wise). The other child works long hours and while not wealthy the business is doing fine. Each child has two children. The second child mentioned will need to dig deep to pay for those grandchildren's college expenses. The first child asked me to stop funding one of her children's 259 because the need is addressed.

Our wills and survivor designations are equal. I am considering making more significant contributions to the other grandchildren's 529 accounts as that will not raise the question of inequitable distribution at death. The last thing I want is to cause our estate planning to drive a wedge between the children.

 

[ivinsfan]

I have a bit of a dilemma. I know that a will communicates more than money (or assets) but one child is very wealthy as a result of her own efforts (grabbing a brass ring employment wise). The other child works long hours and while not wealthy the business is doing fine. Each child has two children. The second child mentioned will need to dig deep to pay for those grandchildren's college expenses. The first child asked me to stop funding one of her children's 259 because the need is addressed.

Our wills and survivor designations are equal. I am considering making more significant contributions to the other grandchildren's 529 accounts as that will not raise the question of inequitable distribution at death. The last thing I want is to cause our estate planning to drive a wedge between the children.

Do the 529's and keep your own council. It's worthwhile and it's your money and your business. The idea that even single thing needs to be equal is getting kind of overblown. As if suddenly one of your kids won't like you if they don't get exactly the same out of your pot. Money is part of legacy you leave but certainly not the most important part....

 

[MBAustin]

A slightly different situation but possibly helpful. My parents planned to leave everything to my sister and me 50/50. After our father died, my sister was the primary helper for our mother for more than 7 years until her death (I live 2000 miles away and they were in the same small town). A year or two before she died, one time when I was visiting Mom she asked if I would mind her changing her will to split things 60/40 since my sister was doing so much for her. I immediately agreed for all kinds of reasons (including that DH and I were already comfortably FI). I would hope our children would behave the same should a similar situation arise.

 

[Vacation4us]

50/50 for my 2 kids. My DH may or may not leave his estate 50/50 to his 2 girls, if not his daughters he will leave his estate to 1 niece.

Should I out live spouse his pension will cover all my needs. My pension will pay his electric bill.

Nothing for charity.

But no one’s winning the lottery mega millions on our demise. My kids aren’t established yet at 19&23. I hope I stick around at least another 20 years and they will be ready and responsible with any inheritance they receive. But no strings attached.

 

[DrRoy]

We originally had a trust that gave 1/3 at death, 1/3 at 25, and 1/3 at 30, but they are now both over 30 so would just get the lump sum.

 

[Scrapr]

A slightly different situation but possibly helpful. My parents planned to leave everything to my sister and me 50/50. After our father died, my sister was the primary helper for our mother for more than 7 years until her death (I live 2000 miles away and they were in the same small town). A year or two before she died, one time when I was visiting Mom she asked if I would mind her changing her will to split things 60/40 since my sister was doing so much for her. I immediately agreed for all kinds of reasons (including that DH and I were already comfortably FI). I would hope our children would behave the same should a similar situation arise.

Similar here. My brother & SIL were closer to our folks. As they slipped into dementia/Alzheimers SIL took over much of the care for them. From driving 30 minutes most everyday to check on them in the family home to moving them to AL to Memory care. Near the end little brother came down with glioblastoma (brain cancer). They boarded him & took him to Dr appointments. I was busy with DW esophageal cancer. Thy all passed in about a year of each other

Parents estate was split 3 ways evenly. Little brothers estate is split about 25/75% toward middle brother & SIL. I'll get about 1/3 of the total combined pot. Middle brother is trustee and was a bit uncomfortable explaining little brothers split. I just said thank you for all you have done. I know this took over your life for 5 years.

 

[Backdraft57]

Spend it

 

[morriss003]

We dole about $1300 a month between our kids, a grand niece and a grand nephew. All will be well off some day, so we don't worry about spending our money on ourselves.\

 

[samcat]

We have a trust and our two kids will split what we have. At this point, the age provision don't really matter as our kids are 21 and 24 and I hope that we both live for a long time so they won't get it til they are in their 50s.

It is important to have a trust not only for inheritance but to make dispersing the trust easier and to avoid probate fees. In California, if you don't have a trust, there is law that regulates how much a lawyer can charge the estate to handle the probate. A trust avoids that and the lawyer charges an hourly rate and it is much cheaper. My husband and I have handled three estates with trusts and because we did a lot of the work, the fees were minimal (maybe just a couple hours).

As for making it easier, if you die without a trust in California, a judge has to approve the sale of a house. If you have a trust, the trustee signs all the papers and the sale happens as a regular sale like the owner is still alive.

 

[meleana]

We have an only child who is now 31 years old. We are leaving him everything we have when we die.


No one else will care about him. We are his family. We love him. He's a good person and he does not have much in the way of money and no assets.

Yup- he gets it all- whatever is left. Our new house when we close on it after it is built will go into a revocable living trust and he is the beneficiary of practically everything else as well. And he is in our will as the sole beneficiary of anything else.



I hope to also help him out a bit while we are still alive so we can see him benefit from it instead of only waiting until we are dead. Rather give it to him then some nursing home.

 

[athena53]

Interesting timing; I finally decided to fork over some $$ to have my Will and Trust updated (would rather spend the money on travel). DH died in 2016 but I'm the sole trustee and there were clear specifications about what would happen if DH predeceased me, which we figured was likely.

Just found out the attorney who prepared it all resigned from the bar 2 years ago and had a disciplinary action pending against him! He'd been reprimanded before after he got in over his head in handling a $4 million estate- no dishonesty involved. He had a solo practice so no associates to contact. I do have all the originals but I'm SURE any new lawyer will want to start all over again. Really annoying. Now I'm looking at $2-3,000 instead of something under $1,000.

I want to keep the trust- it has good provisions in case I become incapacitated. I'm 66, widowed, one son, 3 grandchildren. DS gets it all with my brother, a CPA, as Trustee and I'm fine with that but I see that if DS dies it all goes to the kids leaving my DIL out of it except to the extent it supports the kids. She's the daughter I never had, down-to-earth and a good wife and mother. I don't want to leave her high and dry. I've decided to make her the beneficiary of my IRAs which are not part of the trust- current value is about $1 million, which is 1/3 of my net worth. My withdrawal rate is running under 3.5% and my net worth has increased by close to 3% annually after withdrawals, so I guess I'm not bowing that dough fast enough even though the oldest granddaughter and I are flying to Chicago for a couple of days on Tuesday.

We'll have a discussion about this when I visit next week.

 

[Jim in PA]

About the same as others

I’m divorced. Two daughters in their 30’s, one grandchild.

Estate is mostly IRAs and that’s mostly Roth. I’m aggressively converting the remaining Traditional IRA balance and will be done with that in a couple of years. Taxes on the conversion come from the IRA balance and an RMD. So my plan is that they will each inherit a Roth account. With current tax law, they can withdraw over their life expectancies, so it becomes (potentially) a tax free FIRE nest egg for them.

Right now, I don’t withdraw funds from the IRA balance (beyond the RMD) as my needs are funded from other sources.The RMD is used to pay taxes on the Roth conversion. Since I have reduced the Traditional IRA balance through past conversions, the RMD isn’t substantial. have a LTC policy, so potential care cost is mostly covered.

Right now it’s all 50/50 split between them, but I am considering cutting the grandchild or perhaps grand children in somewhere, at least 529.