Something to consider on leaving money to your kids.
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It makes a lot of sense to help sooner rather than later. Making more and more sense as time and inflation and a new economy go on. I was surprised to read the average net worth of 55-64 year olds was >1 million. Goes to show how ridiculous it is to use the word "millionaire" as if it's a meaningful distinction of wealth. I still hear leftists use it pretty often.
I guess they may have tricked me with an average rather than a median.
Education is extremely important.
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Oh, boo-hoo-hoo...Most young people who come into money blow it. Not to mention, cost for a semi-private room in a Louisiana nursing home is almost $70k/yr, and we are one of the cheapest states.
It doesn't hurt young people to work, to struggle, to budget. Lessons earned are lessons learned. A little help is fine, but your primary responsibility is to take care of your spouse and yourself. Gotta have enough to finish the journey.
The rest is lagniappe.
Also, families that try to practice generational wealth, seem to do just a bit better financially overall.
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Oh, boo-hoo-hoo...Most young people who come into money blow it. Not to mention, cost for a semi-private room in a Louisiana nursing home is almost $70k/yr, and we are one of the cheapest states.
It doesn't hurt young people to work, to struggle, to budget. Lessons earned are lessons learned. A little help is fine, but your primary responsibility is to take care of your spouse and yourself. Gotta have enough to finish the journey.
The rest is lagniappe.
Also, families that try to practice generational wealth, seem to do just a bit better financially overall.
@Jolly said in Something to consider on leaving money to your kids.:
It doesn't hurt young people to work, to struggle, to budget. Lessons earned are lessons learned. A little help is fine,
A little help is what the article is recommending. Nowhere in it is a recommendation to sacrifice your own financial future for your kids' financial present.
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The article advocates dying with $0.
How well does that play in the Asian community?
“Cry havoc and let slip the DOGE of war!”
Those who cheered as J-6 American prisoners were locked in solitary for 18 months without trial, now suddenly fight tooth and nail for foreign terrorists’ "due process". — Buck Sexton
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@Jolly said in Something to consider on leaving money to your kids.:
The article advocates dying with $0.
How well does that play in the Asian community?
Someone wrote a book with that title. It's hard to predict the day you'll die though, so I would assume it's hyperbole.
I think the idea is to take the money you'd hope to leave to your kids after you die, and portion it out to them over time, starting well before you die. This requires an impossible prediction of how much you'll need of course, but it's the theme.
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It makes a lot of sense to help sooner rather than later. Making more and more sense as time and inflation and a new economy go on. I was surprised to read the average net worth of 55-64 year olds was >1 million. Goes to show how ridiculous it is to use the word "millionaire" as if it's a meaningful distinction of wealth. I still hear leftists use it pretty often.
I guess they may have tricked me with an average rather than a median.
@Horace said in Something to consider on leaving money to your kids.:
I was surprised to read the average net worth of 55-64 year olds was >1 million. …
I guess they may have tricked me with an average rather than a median.Indeed they have, see https://www.nerdwallet.com/article/finance/average-net-worth-by-age
“Average” is above $1.5 million.
“Median” is below $400k. -
I see it as more of a directional nudge than a coherent plan where you can put a number to the amount you should give your kids before you die. A directional nudge away from giving them nothing until you die, at which time they get the lump sum you managed to accumulate, and towards giving some of that to them while they're younger and could benefit more from it.
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I am OK with the directional nudge.
Make the kids struggle a bit on purpose? As a matter of education and development of character, fine to an extent. But that happens before they graduate high school. Hopefully by then you can see whether a kid is one who can appreciate delayed gratification or one who would blow a lump sum quickly. Intentionally make them “struggle more” beyond that probably won’t yield much additional benefit at the margin.
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I think the best thing you can do is leave the children a good accounting of the estate and detailed document about how to deal with it.
My list of userid/passwords is 73 pages long. When the time comes they will be happy to have it.
A simple list of assets, subscriptions, memberships and so on would be nice too.
And wrap it all up in a Will and a Trust.
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It’s a sliding scale, and really varies a lot on your very individual circumstances. Right now, if something happened to Karla and I, the property, insurance, and assets are weighted heavily towards getting Lucas through his schooling and getting a good start on his life. Yes, there will be a trust for Finley and we are making sure that he would not be a financial burden on his guardians, but the goal and hope is to have Lucas be able to comfortably assume that guardianship when Finley is 10-13 and Lucas would actually be an adult and established and ready to take on that responsibility. And we trust that Lucas will be able to provide a similar support for Finley when he gets to college and young adulthood.
As we get older, and they get older, that will shift. When I hit retirement age, Finley will just be graduating HS and Luke should be well established At that point the will will lean more heavily towards getting Finley but with Lucas in a trustee role.
After that, I’m hoping to shift again. And we will be looking at a $0 inheritance. Instead, I think we will be aiming for a property to be left. We would like to build a retirement home that would be accessible for both Lucas and Finley to bring their families to. A 4 season place, maybe in Ohiopyle where everybody could enjoy the lake in the spring/summer, skiing in the winter, and hiking in the mountains whenever… The hope is that this would become a familial site that will stay in the family for several generations. So no money, just the land…
That’s the hope, anyway. But who knows? We’re staying flexible for now.
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Good plans, LD. Love the vision, too.
Yeah it comes down to each family's situation, savings, and trust.
I want our kids to know the value of investing and compound interest (I learned that later than I should've), and I want them to have access to our wealth without knowing the amount (or inheritance) directly. So I've set up UTMA accounts for each kid, and contribute to it on a monthly basis. It follows the S&P. So in theory (and for example) if over 21 years I contribute 25k, they should have about 80-100k in it by the time they turn 21 and automatically get access to it.
Will they use it for drugs? Hopefully not. Perhaps they'll learn the value of investing and just keep the contributions going and then retire early. Or perhaps they'll use it for a house purchase downpayment.
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I am leaving everything to my spouse. She can dispose of it as she wishes. But if the teenager gets a penny or two that’s up to her.
If I survive my spouse, it is my intention to
bounce the cheque on the undertaker.@Renauda said in Something to consider on leaving money to your kids.:
If I survive my spouse, it is my intention to
bounce the cheque on the undertaker.I hate to think what he'll do to your corporeal remains when he discovers the shortfall.
I was only joking
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@Mik said in Something to consider on leaving money to your kids.:
The problem being one must to plan one’s demise pretty precisely.
Right. It’s one thing to bounce the check to the undertaker, quite another to bounce the check for the 2nd to last chemotherapy session…
