How much will you leave your children?

How much will you leave your children?

For many Americans, we’ll work hard and accumulate some level of wealth.  At whatever level wealth is defined, there will be some level of relative value.  The question is what will we do with that wealth, and particularly how much will we leave to children.

It’s an often-debated question and yet often ignored.  For many, the default answer is to leave it to children.  Many parents see that is their duty.

In my work, I’ve seen a broad spectrum of views.  Some parents, particularly those who had to work hard to earn their wealth, take the view that they will leave their children little if anything.  The rationale is that because they had to work for their money, their children should as well.

Others take a moderated view and structure their estates to leave their children varying amounts at varying ages of responsibility, i.e., 25, 35, 45 etc.  The thought here is that wealth should not be dumped upon children and take away their incentive for work.  Give wealth to them as they demonstrate greater responsibility.

Of course, some parents are fully of the mind that the entire estate should go to the children.

This decision can often divide spouses.  Some see the inheritance as an act of love, while others see it as a curse.  The curse particularly surfaces when children don’t act responsibly whether through lifestyle decisions, financial decisions or addictive behaviors.  Each gives reason for pause.

From my own work with families, I also know that the decision doesn’t go away.  It may be deferred or ignored but it still has to be made.  Worse, I see the decision made in crisis—usually spurred by some trip where the parents realize “oh my, we both could die in a plane crash and then what would happen?”  Or I see the decision deferred until ravages of age creep in, and the parents no longer lack the will or mental acuity to make the decision.

In the coming weeks, I’ll begin to address some of the principles by which families make this decision.  For now, if you have your own thoughts or principles you’d like to share, email me at whigh@ncfgiving.com

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