Inheritance etiquette PSA

ArrowFlyer86

ArrowFlyer86

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If your kids are ever fighting with you about what money they deserve as an inheritance, or what the split should be with siblings/step siblings/etc, you should give them zero.

Zip, zilch, zero.
Absolutely nothing. Not a dollar.

Leave them a letter about the lifetime of responsibility it took to acquire what you have while raising them as a parent. Remind them the decision of how to spend (or not spend) that is entirely up to you. And that someday they'll understand that. The financial legacy you choose to leave behind (or not leave) is YOUR choice.

I say this because I have an elderly close relative in poor health whose conversations with their son have taken a really awful turn and it's messed up stuff. It doesn't impact me financially, instead just seeing his dad in bad health and his relationship with his own child failing all because his kid thought he could use his dad's assets to fund his own lifestyle.

If you ever find yourself in that situation, don't cave to them. The best lasting gift you can give them is not money, it's wisdom and perspective.
 
Ventucky Red said:
As my father put it and actually did, make sure the last check you write bounces.. my brother and I made it good, but to this day we lament, "he was a man of his word.."
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Its the way to do it. I encourage my dad to spend it all and enjoy life. Take nice trips abroad, splurge for the fancy steak dinner, order the nicer bottle of wine. He raised several kids and worked for 45 years. The parents deserve it. If there's a penny left over when they're done enjoying life -- I'll still be reluctant to accept it.
 
If my kids or grandkids are being petty about things, that's one thing. If I'm being treated as a bank account, I get it.

Otherwise, my dad benefitted from a modest leg up from his grandfather. I benefited the same from both grandpa and parents. My kids didn't have to worry about school loans nor having to drop into their early 20's worrying about being homeless if they lost a job.

I would consider it irresponsible, selfish and a disgrace to the family that came before me if I bounced my last check instead of paying it forward for another generation. A down payment on a house will mean a hell of a lot more to grandkids trying to get launched than steaks and vacations will to me.
 
172andyou said:
I would consider it irresponsible, selfish and a disgrace to the family that came before me if I bounced my last check instead of paying it forward for another generation. A down payment on a house will mean a hell of a lot more to grandkids trying to get launched than steaks and vacations will to me.
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I guess it depends on your family situation.

If I inherited a bunch from the precious generation I may feel more of an obligation. But if not, I feel absolutely zero obligation to leave anything.

And even in that case, still, it requires best judgment. Cuz you know what's worse than leaving nothing? Leaving money to deadbeats who think they're entitled to anything because grandpa saved his pennies.

But again -- I guess it depends on the particular scenario. In no world would I ever be *guilted* into leaving an inheritance.
 
I don't feel an obligation to leave any, but I also don't feel an obligation to burn through it all.

I'm fortunate, I don't have deadbeat offspring...but there's no telling what the future holds. In a perfect world I'd like to set up some sort of scholarship fund or charity that would be large enough to need my kids as the board of directors. Let them figure out how to use it for good. But there won't be enough left for that, so they'll probably get enough for a new used car.
 
ArrowFlyer86 said:
I guess it depends on your family situation.

If I inherited a bunch from the precious generation I may feel more of an obligation. But if not, I feel absolutely zero obligation to leave anything.

And even in that case, still, it requires best judgment. Cuz you know what's worse than leaving nothing? Leaving money to deadbeats who think they're entitled to anything because grandpa saved his pennies.

But again -- I guess it depends on the particular scenario. In no world would I ever be *guilted* into leaving an inheritance.
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You clipped out the parts where I said essentially the same things about pettiness and being a bank account. :-)

But I will add this wrinkle. Paying it forward has to start somewhere. Even if I had inherited nothing more than the good fortune to have been raised well and never gotten a nickel in cash, why wouldn't I want to do even better for my kids and grandkids? It would still be amazing to provide them with that kind of support, even if I hadn't received it myself.

But, again, I take your point. There is someone in my generation that has dead-beated herself out of the finances of the family. And I'm ok with my fathers choice on that also.
 
My brother was kind enough to inform our parents that they were allowed to gift their kids annually tax free to reduce the burden of inheritance taxes later.
 
I remember when I graduated from college, Dad said congrats, now I'd never miss a meal. Might be spaghetti-Os, but I'd never miss a meal. Years before he died, he put everything into a trust with me as co-owner (or whatever the term is) with instructions. When he died, there were no hassles with lawyers, relatives or anything else. I sold his house in Phoenix, donated the car (not worth even trying to sell it), put what I wanted into a truck, donated everything else and all the clothes and headed back to Denver. When I got home and the sale on the house cleared, I sent very nice (and I mean NICE) checks to my two cousins back east (his niece & nephew). I kept what was left of his IRA, I think it paid my taxes that year.

Of course what wasn't shared was the gold coins, the mint proof sets, and his half of the cherokee. I put down half in cash, he put up the other half when we bought it. Since he spent 4 months of the year up here to get out of the Phoenix heat, wasn't a bad idea, as he was also a pilot.

I don't have kids so my will leaves half to scholarships at Univ of Texas, Univ of Denver and Metro State - my 3 schools of choice, the other half is split to two close friends and a few relatives. I only have a few relatives, so it's easy.
 
Unless their estate is 14mil or so, that doesn’t matter
 
My brother asked me what I thought his will should be like, in general. In my opinion, skip a generation, do not feed the IRS twice.

He had some lean years, each of my sons had sent him money to keep the IRS from auctioning his shop (I had also). They are both hard working men, and believed in him. Unexpectedly, he paid it all back with interest.

When the will was complete, my brother had all three of us to the signing and witnessing. His attorney asked me in private if I was upset about the small amount that I was to receive, and if so, he would try to get the amounts changed. No, the share I am to get is what I suggested to my brother.

After 6 years in court on patent infringement suits, my brother was now a millionaire.

I did not inherit much in the way of cash when my Dad died, but my brother and I did inherit all his tools, which produced a bedrock foundation for our mechanical efforts, and had a lot to do with his research, including building an operating example of his technology. That was the clincher on his efforts to get the original patent.

I have steak several time a month, prefer filet mignon, but a buck fifty hot dog when I shop at Costco. Greek gyro for supper tonight, soup, salad, 2 sides, and desert. I am not shorting myself, but neither am I working to leave an empty bank account.

Most of our "leftovers" will likely skip a generation too.
 
There is a doozy coming in my family. Probably the most valuable piece of undeveloped land around is owned by my aunt who inherited it by marriage. She's always been a hard nosed penny pincher, which was amusing at first, then became a mental illness. However, it has led to a substantial nest egg. Anyway, she has a daughter who stuffed a previous inheritance up her nose, and is hovering over her mom in hopes she can get a bigger piece of the estate. With two other siblings, its gonna be a donnybrook.

In the extended family, I've always been the go-to person to handle estates because I appear to be trustworthy and not a chisler, cheat, or money grubber. But I wouldn't touch my aunt's estate for all the tea in China. Whoever is the executor of that one is gonna be miserable, regardless of the executor's fee.
 
kyleb said:
In the extended family, I've always been the go-to person to handle estates because I appear to be trustworthy and not a chisler, cheat, or money grubber. But I wouldn't touch my aunt's estate for all the tea in China. Whoever is the executor of that one is gonna be miserable, regardless of the executor's fee.
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My friend put me in his and wife's estate plan for managing their daughters trust for the same reason. Finance guy, conservative, don't blow my money on dumb stuff (*cough *cough* they don't know about airplane expenses *cough *cough).

They do very well for themselhes. But everyone else in their collective family is either flat broke or in massive debt. The last thing they wanted to do in the event of an untimely death is make their daughter a financial pawn in a family that buys $75k cars and buys $5k handbags with $50k salaries.

God forbid that day ever arrives I'm sure it'd be a a full on financial assault from the family. I encourage him to adopt low risk recreational activities specifically so I never find out how rabid the family can be.
 
We have a ‘family business’ meeting once a year; it should be no surprise to our kids what any distributions would look like since most of it is either term life or qualified accounts that pay out per the beneficiary splits we have on file. Remaining real property is to be liquidated and distributed according to our letter of instructions for the executor. Both kids have a copy of the will and letter of instructions.

Now that we have one couple with child and one couple without, things will change a bit and if everyone has been listening, nothing will be a surprise.

Everyone is aware of the ‘tripwires’ -behavior based reasons for exclusion, when the insurance policies go away, and the fact that if anything is left over once we’re done and gone, they should be grateful since it’e entirely possible what we have could be zero’d out due to end of life care.
 
Personal story.

When my grandpa passed the family was... Fragmented. He had remarried when my grandma passed. My uncle's wife pretty much drove wedge trying to spy on him. From the time I was 12-17 I saw him exactly 3 times. When my buddy turned 21 he had his party near my grandpa. 3 hours away from home. So I stopped in unannounced. He was smoking on his porch when I pulled up. I didn't quite recognize him. He didn't recognize me. Thought I was selling meat out of my truck. Spent 6 hours catching up. It was great. We had family a few blocks from him. But he said my aunt threatened to find out what he was doing through them. So he didn't talk to them he didn't need that crap.

A few years later it was my sister's college graduation. I knew he was invited but wasn't going to show. I drove 3 hours to see if I could get him to go. After 2 hours talking he learned we don't talk to my aunt and uncle. Then he said he had to get dressed. Comes out all pressed and dressed. Then drove himself down. My mom was ****ed. My phone is blowing up cuz I'm not helping with the party. She's about to rip my head off when I came down the driveway. Then she sees who was following me.

After that my mom and her dad actually talked. She went up there and played softball with him. One of my prouder adult moments.

Then he got bronchitis which turned into necrotizing pneumonia. He was found in the house after a few days, alive but gone. At the hospital mom asked if there was life insurance. "New family" said they already looked and said there was nothing. They gave him love and cared for him. The son in law pulled me aside after and said how much he spoke of me. Absolutely lost it at that point.

Fast forward a few weeks. Mom gets a call out of the blue. Insurance company paying out life insurance from a policy from the 60's. Asked my mom's name and uncles. Then asked who Patricia is. Step daughter. Insurance agent said she called them claiming to be his daughter. Essentially trying to commit insurance fraud. So she lied about insurance and then tried to claim it.

In the will it read my mom and uncle "are to get nothing as they've been adequately provided for their entire life"

I could care less about money, cars, or real estate. I'd like some of the photos they know nothing about. His racing helmet as we both raced at the same tracks 40 years apart. His volunteer fire helmet mounted on the alarm that was in the house.

TLDR. If you want something from someone when they go. Be a decent, loving, supportive person while they're here. But asking while they're still here just feels dirty.
 
I'm being harsh because OP wasn't speaking of his own kids. The harsh comment is that if you've screwed up parenting bad enough that your kids are fighting over what's left after you die, then it doesn't matter at all what you do.

The one caveat is that there are good people who are absolutely horrible with money. If that's the case, maybe some sort of trust is in order, I don't know.

My advice would be to spend time with the people you care about before you or they are gone, be that friends or relatives. Life's too short to hang out with people you don't like unless you're getting paid to do it, or your supporting someone you do actually care about.
 
I didn’t have much growing up. Through decades of hard work by my wife and me my kids will have an inheritance. That’s what I worked for. They have different views and political affiliation than I have. I will not begrudge their views. I raised good kids. They are likely smarter than me.

We are trying to spend their inheritance with them. No need to make them wait for our death. Especially since we can enjoy it with them before they inherit it. Plenty to go around. It’s not adversarial.

My grandma told me not to buy flowers for her grave. Buy them when she could still enjoy them. My Grandma was wise.
 
My goal is to leave my children an inheritance strictly from life insurance benefits and avoid taxes. I hope to spend/donate the remainder.
 
My parents exhausted their estate. After running the gamut from independent living, assisted care, and skilled nursing home expenses, their residual estate was less than $15.00.

You can’t plan it that closely! Luck counts. Thanks, Mom and Dad, for living full and happy lives. Love you both!

-Skip
 
Skip Miller said:
My parents exhausted their estate. After running the gamut from independent living, assisted care, and skilled nursing home expenses, ...
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These are designed to remove you from your money. I tell my friends all the time take care of your parents if you can.

I don't plan to live like a pauper when I retire just so my kids get wind fall but I also don't plan on living much different than I do now. If we spend it all, so be it. If not, I am happy for my kids to get something when we go. I suspect my wife although a few years older will outlive me by a bit.
Having said all that, generational wealth can be a game changer. Says the man with two kids 32 and 28 not married yet). :rolleyes:
 
DFH65 said:
These are designed to remove you from your money. I tell my friends all the time take care of your parents if you can.
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I would also note that there are limits to taking care of your elders, whether it’s their condition, the caregiver’s ability, or some combination thereof. Sometimes it’s better to have professional help.
DFH65 said:
I don't plan to live like a pauper when I retire just so my kids get wind fall but I also don't plan on living much different than I do now. If we spend it all, so be it. If not, I am happy for my kids to get something when we go. I suspect my wife although a few years older will outlive me by a bit.
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We’re just starting to make the transition toward retirement…barring huge issues, we’ll maintain our current lifestyle (improved by the ability to have a more healthy lifestyle, quite frankly) and still be able to pass on something to the kids.
DFH65 said:
Having said all that, generational wealth can be a game changer.
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agreed…a modest inheritance when my grandparents passed paid down a chunk of my house, ultimately allowing me to divert income elsewhere a few years later, allowing me to move toward retirement now. I should be able to give my kids/grandkids a similar opportunity.
 
Friend 1:
Spending it all, but if he doesn't, only his son gets anything. His daughter messes with drugs and she ain't getting a penny!

Friend 2:
Has 300k in bitcoin. Already giving in and funding a young grandson who is gambling on options in the stock market with absolutely no experience...but he was up $500 one day! Keeps asking for more money, and now has a plan to 'go to the airlines' and is asking for 100k interest free loan. He'll never do it, has no real interest in flying. It will be gambled in the market until it's gone trying to hit it big.

Friend 3:
Lot's of money, but won't spend it. His kids are getting it all. They can give to the grandkids as they see fit.
@EdFred, PM me for name/address to start possible adoption process. (I get half)

Friend 4:
Spending some, giving kids some. Is enjoying life but making sure to leave at least some at the end.

Friend 5:
Depends on how it goes at the poker tables.

Me:
Options 4, then 5
And apologizing to kids about all the junk they have to get rid of that I've kept for 30 yrs to save money.
It wasn't too bad for the first 20 yrs, only had a 1 car garage.

But then.... I got a hangar. :devil:
 
Skyrys62 said:
Friend 5:
Depends on how it goes at the poker tables.
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I have a friend pushing 90 that only works to have money to go to the casinos. To each their own, I suppose, but if I'm 90 and still framing houses I'm going to consider that a failure.

OTOH, I'm sure that keeping moving is a big part of why he's still alive. Life is complicated.
 
DFH65 said:
These are designed to remove you from your money. I tell my friends all the time take care of your parents if you can…
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Many, but not all. My mother deliberately went this route once the house was too much for her to maintain. She spent a little over 8 years there, graduating (her words) from independent (~6 yrs) to assisted living (~2yrs), then over to skilled nursing for about six months or so.

She was shrewd…in IRS accountant…and much of the cost was bore by her federal long term care policy. When she transitioned to assisted living (about two years), she effectively used her RMDs to fund an in home service to supplement what was not covered by the facility. That was her only real bill to pay above and beyond the all inclusive rent and that service ended when she went to skilled nursing. Her facility’s ‘rent’ structure was set at move in to each tier and was guaranteed not to change for the duration. There were higher rates for those that did not start off in independent living.

Her last 30 or so days came unexpectedly. She was dropped during an assisted transfer to her bed, breaking her femur. This happened about half an hour after my daughter and I had left from a nice visit. That forced a trip to a hospital, then a rehab hospital (that’s expensive), then she decided it was time after about two weeks and moved to a wonderful hospice facility for about a week.
 
Our plan is when we have enough of a portfolio to retire, live on a little less than what the dividends/interest is per year. Let it continue to grow. However, seeing what the last 10 years of life can cost and what care facilities look like, sorry kids, we're keeping enough around to be able to pay for in home care. If there's any left, you'll get it, but no sense in ****ing it/giving it away and then being a financial burden for the last 10-15 years.
 
EdFred said:
Our plan is when we have enough of a portfolio to retire, live on a little less than what the dividends/interest is per year. Let it continue to grow. However, seeing what the last 10 years of life can cost and what care facilities look like, sorry kids, we're keeping enough around to be able to pay for in home care. If there's any left, you'll get it, but no sense in ****ing it/giving it away and then being a financial burden for the last 10-15 years.
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Yeah, even if I agreed with the "last check bounces" crowd, the practical reality is that none of us know what our final years are going to look like from an expense standpoint. And I sure as hell don't intend to become a financial burden to the kids if I end up living ten years past a stroke (as a friend did) or till I'm 104 (like grandma did). If that means that I die six weeks after getting a pancreatic cancer diagnosis with enough in the bank to take care of myself had things gone differently, so be it.
 
172andyou said:
Yeah, even if I agreed with the "last check bounces" crowd, the practical reality is that none of us know what our final years are going to look like from an expense standpoint. And I sure as hell don't intend to become a financial burden to the kids if I end up living ten years past a stroke (as a friend did) or till I'm 104 (like grandma did). If that means that I die six weeks after getting a pancreatic cancer diagnosis with enough in the bank to take care of myself had things gone differently, so be it.
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Before I got married my plan was if I got diagnosed with anything, or I was cognitive of a decline happening, take one last big trip, finish it in The Serengeti, and walk off into the bush in the middle of the night. If I was 55 when that came to be, then I was 55. If I was 85, then I'd be 85. That idea has now been BEEN FROWNED UPON BY THIS ESTABLISHMENT!
 
My wife and I don't have expensive tastes, so other than lots of travel we don't imagine our retirement expenditures to be excessive. So I'm guessing there'll be a lot of money going to the kids once we're gone, but it's not something we actively think about.

As @172andyou said, we mainly don't want to be a burden, so we're also making sure we're well insured against medical/cognitive problems as we age.
 
EdFred said:
Before I got married my plan was if I got diagnosed with anything, or I was cognitive of a decline happening, take one last big trip, finish it in The Serengeti, and walk off into the bush in the middle of the night.
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What a coincidence. That sounds much like Mrs. Half Fast's plan for me, though she'll probably drop me off in the Everglades rather than pay for a trip to the Serengeti.
 
IMHO this starts a long time before anyone is in a position to inherent anything.

My great-grandparents taught my grandparents to fish (both metaphorically and practically) so that they could stand on their own. Each generation since - and likely many generations before that I am unaware of - has helped their children to be self-sustaining. And, where possible, they have supported their childrens' well though out and realistic aspirations financially as well as well as emotionally.

My parents supported my education and flight training. Without them I would not be where I am today . . . flying small low-powered aircraft over large bodies of frigid water . . . okay, but it will get better (so that I can fly larger aircraft over shark-infested water). I hope that anything that I inherit from my grandparents or parents is long in the future. They have already given me what truly matters in life.
 
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