How do your heirs look at their potential inheritance? Maybe they have not thought about it — or talked to you about it — at all. Maybe they see it as a bonus, but it’s not money that they’re counting on. Or, like many, maybe they view it as a retirement fund.
This is how a lot of adult children think about their inheritance. They know that it will be difficult to retire with their current level of planning and saving. They hope that you will leave them money to make up for these deficiencies.
As one investment professional put it: “For those who are behind on their retirement savings, this windfall can be a once-in-a-lifetime do-over.” They recommend making saving for retirement the main priority for those who have just inherited significant financial assets.
While that is wise for those who do inherit enough to retire on, what about those who get far less than they expect? Are they going to be shocked and angry about what they receive? For instance, if you leave half of your money to charity, are they going to try to contest the will — not because they think it’s false, but because they desperately need your money for their own financial interests?
Situations like this get very tricky, especially when there is a difference between what heirs expect and what you actually plan to leave them. You may want to talk to them in advance so that everyone is on the same page. Regardless, you definitely want to know about all of the legal estate planning options you have.