The traditional way of passing wealth down to later generations by giving descendants inheritances does not work for everyone. If a child needs money to start a business now, many wealthy parents would rather give the child the money when it is needed and when they can see the results of the gift. The alternative might result in the child missing out on the business opportunity.
Surveys suggest that a majority of older Americans would prefer to give to heirs now rather than wait to give them inheritances. However, before giving to heirs now there are a few things that need to be considered.
This subject was taken up recently by Merrill Lynch in “Why Make Your Heirs Wait?”
These things include:
- If you give to one heir now, other family members might wonder what is going on and might want a gift as well, even if they do not have a pressing need for it. You should talk to your family and make sure everyone knows that a gift now might make their eventual inheritances smaller.
- Do not give to your family for selfish reasons. Consider whether the receiver actually needs and wants the gift. Giving someone a responsibility they do not want or are not ready for could be a burden to them.
- Do not give away so much that you neglect your own needs. Before giving to anyone take stock of how much money you need for your own retirement.
A qualified Cincinnati estate planning attorney can help you think through your options and remove the emotion from the decision.
Remember: “An ounce of prevention is worth a pound of cure.” When making your estate plans or when probating an estate or administering a trust, do not go it alone. Be sure to engage a Cincinnati estate planning attorney.
For more information about estate planning, probate or trust administration in Cincinnati (and throughout the rest of Southwest Ohio) and to review free resources regarding estate planning, probate or trust administration, visit my website. If you have questions regarding this article or a particular legal matter, feel free to contact me at 513-399-PLAN (7526).
Reference: Merrill Lynch (Aug. 2016) “Why Make Your Heirs Wait?”