Thursday, May 19, 2011

But I'm Not Dead Yet!

“The reports of my death have been greatly exaggerated.”
~ Mark Twain

When is an inheritance not an inheritance? When the very event that creates the inheritance has yet to occur. If you are still vertical, then by definition, your assets are not yet an inheritance. Your children and perhaps other family members, may think otherwise. They may think they are entitled to an “advance” on the inevitable. Yes, it is inevitable. In spite of the popularity of living and advances in medical science, the mortality rate has not budged from its historical ratio of 1 to 1, i.e., all of us.

I remember a conversation I had with my Dad sometime in the ‘70’s when I needed use of his extensive tool collection. He said something along the lines of “When are you going to get your own?” and I retorted “I’m just gonna wait until you die Old Man and then I get them all.” He didn’t think much of that. About 30 years later, my wish came true. Be careful what you wish for.

I don’t know if there have been any studies done, but in my experience one of the primary financial problems (holes punched in their retirement boat) for retired people is their inability to say “no” to their children when it comes to what we might euphemistically refer to as “inheritance advances”. This is a problem that afflicts all, regardless of asset balance – the bigger the balance, the bigger the “advances”.

Don’t misunderstand me. If its affordable, then “it’s your money” as they say. BUT CONSIDER IF IT IS AFFORDABLE FIRST. Don’t say “yes” and then discover that it’s not a good idea after the fact. If you have more than one child, how do you tell the second, third and fourth “no” after you said “yes” to the first? It’s not “their” money until you’re dead and they should be ashamed of themselves for asking.

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