Have you thought it all through?


After finally getting his estate planning done Marty was told by his advisory team he is “all set.” He settled on leaving $2 million to each of his two children. Now he’s all finished with the inheritance discussion. Or maybe not.

His daughter and her husband earn $130,000 a year. The $2 million at just five percent income each year on the money will almost double their current income. Sounds nice… but is doubling the lifestyle to which they are accustomed the right thing to do?

Marty’s other child is a 24-year-old son who hasn’t yet found his way and earns about $15,000 a year. With a $2 million inheritance his lifestyle would grow by about ten times what he is accustomed.

The right amount of inheritance is not merely a financial decisions. There are more essential questions that need to be answered:
• Is each child responsible enough to handle the proposed inheritance?
• Does the proposed amount help or hurt their ambitions in life?
• Has the effect on the spouse been considered?

These are just a few of the questions left unanswered for Marty. The most vital question to answer before the dollars are even considered is this: Is the purpose of the inheritance to provide an enhanced lifestyle or new opportunities?

No matter how little or how much the inheritance there is no easy answer and it is certainly more than than simply about the dollar amount. Like most, Marty still needs to think through the implications of the bequest – but most parents rarely do.

What are the possible implications from the inheritance you have planned? Are there some blind spots out there– maybe ones you haven’t even considered?
Wealth is more than money. Don’t just plan for your future, live it right now.

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Retirement Matters