Author Topic: Inheritance Drama: You Got Any? Stories Wanted.  (Read 1086154 times)

Adventine

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2750 on: October 06, 2021, 02:04:12 PM »
This is a cautionary tale for parents leaving their children money. In my opinion, the child didn't do anything wrong. However, they were not mature enough and/or not emotionally ready to handle an inheritance of 250K.

My brother-in-law shared a story of a mutual friend who broke up with their girlfriend. The girlfriend was in their early to mid 20's and was gifted 250K of life insurance when her mom died a few years ago. She is a college grad and has a full-time job. Before the death she was able to fully support herself. However, after the death she was emotionally devastated and spent 200K of the 250K over the course of 3 years. She has nothing to show for it other than a car. At one point, she owned two cars. However, she has since sold the second car. 

What type of guard rails could you put up for your children to try to avoid this? Can anything be done?
The only durable guard rails I can think of are:- staggering the release of the life insurance payout- raising your kids with non-materialistic values

Otherwise, not much else to be done except hope that your kids hold on to those values after you pass.

Imma

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2751 on: October 06, 2021, 02:26:22 PM »
This is a cautionary tale for parents leaving their children money. In my opinion, the child didn't do anything wrong. However, they were not mature enough and/or not emotionally ready to handle an inheritance of 250K.

My brother-in-law shared a story of a mutual friend who broke up with their girlfriend. The girlfriend was in their early to mid 20's and was gifted 250K of life insurance when her mom died a few years ago. She is a college grad and has a full-time job. Before the death she was able to fully support herself. However, after the death she was emotionally devastated and spent 200K of the 250K over the course of 3 years. She has nothing to show for it other than a car. At one point, she owned two cars. However, she has since sold the second car. 

What type of guard rails could you put up for your children to try to avoid this? Can anything be done?
The only durable guard rails I can think of are:- staggering the release of the life insurance payout- raising your kids with non-materialistic values

Otherwise, not much else to be done except hope that your kids hold on to those values after you pass.

I know my mother put a staggered release of funds in her will when we were younger. It was possible to get larger payments but only after the permission of a specially appointed trustee or a judge. The person who was appointed as a trustee was a proto-mustachian. This part was removed from the will when we all proved to be sensible with money.

Other than those options, there's not much you can do either way except raise your children well. I know of people who were in their 50s with a comfortable income who blew through an inhertance in no time, I also know a person who inherited a fairly large amount of money at the age of 18, made a mess of their whole life for years, but never ever touched the inheritance in their savings account. Still has it as far as I know, waiting to be used as a downpayment on a property some day (not the best option from a mustachian point of view, but there are lots of worse things to do with a 6-figure inheritance than putting it in a savings account and buying a family home eventually).

DadJokes

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2752 on: October 06, 2021, 03:02:23 PM »
This is a cautionary tale for parents leaving their children money. In my opinion, the child didn't do anything wrong. However, they were not mature enough and/or not emotionally ready to handle an inheritance of 250K.

My brother-in-law shared a story of a mutual friend who broke up with their girlfriend. The girlfriend was in their early to mid 20's and was gifted 250K of life insurance when her mom died a few years ago. She is a college grad and has a full-time job. Before the death she was able to fully support herself. However, after the death she was emotionally devastated and spent 200K of the 250K over the course of 3 years. She has nothing to show for it other than a car. At one point, she owned two cars. However, she has since sold the second car. 

What type of guard rails could you put up for your children to try to avoid this? Can anything be done?
The only durable guard rails I can think of are:- staggering the release of the life insurance payout- raising your kids with non-materialistic values

Otherwise, not much else to be done except hope that your kids hold on to those values after you pass.

I know my mother put a staggered release of funds in her will when we were younger. It was possible to get larger payments but only after the permission of a specially appointed trustee or a judge. The person who was appointed as a trustee was a proto-mustachian. This part was removed from the will when we all proved to be sensible with money.

Other than those options, there's not much you can do either way except raise your children well. I know of people who were in their 50s with a comfortable income who blew through an inhertance in no time, I also know a person who inherited a fairly large amount of money at the age of 18, made a mess of their whole life for years, but never ever touched the inheritance in their savings account. Still has it as far as I know, waiting to be used as a downpayment on a property some day (not the best option from a mustachian point of view, but there are lots of worse things to do with a 6-figure inheritance than putting it in a savings account and buying a family home eventually).

I'd agree that paying out smaller portions over time and raising money-smart adults are the best two options. A third option could be to severely limit how much the kids get, spreading the money around more.

Assuming that I'm a multi-millionaire by the time I die, I don't plan to leave all of my money to my only child, regardless of how responsible he is. I'll leave him a good amount, but hopefully not so much that it significantly impacts his life (other than speed up his time until FI). The rest would go to college funds & student loan debt of grandchildren, nieces, and nephews, followed by favorite charities.

Dee18

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2753 on: October 06, 2021, 03:18:53 PM »
The attorney who advised me, when my daughter was one and I got my first will, set up a revocable trust with my assets rolling over to that trust upon my death.  (A trust can be named as the beneficiary for life insurance, investment accounts, etc.)  I had a friend willing to be trustee and the terms (again recommended by the attorney) provided that until my daughter was 26 the trustee was in charge of the money and could use it to support her and for things like college and for travel. At 26 she would get 25% of the remaining money, at 30 she would get 30% of the remaining money, at 35 she would get 50% and the rest at age 40.  I was always very responsible with money so I was prepared to have it go to her at 25, but the attorney advised me that no one can predict how a one year old will be with money and my assets were likely to much higher by the time of my death. 

Zamboni

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2754 on: October 06, 2021, 04:09:39 PM »
Not so much a concern about a lawyer out to be malicious. But in any profession, if I just pick the first person I happen to see a sign for, Id never know if theyre gonna half-ass it, especially if it isnt a lot of income for them to do a simple will? My friend group used to be primarily childless PhD students, so I wouldnt think any of them would have a recommendation. Though I suppose I could ask some of my kid and/or asset having local friends who might actually have a will drafted. Seems a weird topic of conversation to bring up I guess, haha.

We received lawyer recommendations from two people: the guy who finalized our term life insurance (you have that too, right?), and some friends we play cards with. Then I ended up going with a friend from college who had become a lawyer. He sent me a boilerplate questionaire over email, drew up a draft quick, and then we met at a copy shop to get it all signed and notarized.

From what you describe, you should be able to get everything you need (will, healthcare power of attorney) for about $300-500. I'd be skeptical of anyone who says it needs to cost more than that unless you already have millionaires of dollars and need a trust to avoid taxes.

You should definitely have a will with name guardians unless you want your child to end up in the foster care system temporarily in the event of your untimely death.

PDXTabs

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2755 on: October 06, 2021, 04:43:15 PM »
One additional note: tax planning around inherited IRAs/401Ks in trusts is complicated.

Britan

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2756 on: October 06, 2021, 06:50:25 PM »
We received lawyer recommendations from two people: the guy who finalized our term life insurance (you have that too, right?), and some friends we play cards with. Then I ended up going with a friend from college who had become a lawyer. He sent me a boilerplate questionaire over email, drew up a draft quick, and then we met at a copy shop to get it all signed and notarized.

From what you describe, you should be able to get everything you need (will, healthcare power of attorney) for about $300-500. I'd be skeptical of anyone who says it needs to cost more than that unless you already have millionaires of dollars and need a trust to avoid taxes.

You should definitely have a will with name guardians unless you want your child to end up in the foster care system temporarily in the event of your untimely death.
Hahaha.  Did I mention we need to be adults? We gotta figure out life insurance too. My old workplace had an option. But now neither of our workplaces offer it.

Tbh, temporary foster care would be preferable to my closest (physical proximity) relative - my mother - swooping in for temporary custody.

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2757 on: October 06, 2021, 07:58:47 PM »
So @Zamboni several things: first, and most important of which is THAT I AM TERRIBLY SORRY YOU AND YOUR SO ARE HAVING TO GO THROUGH THIS!  That can't be said enough.  This is not normal or humane behavior.   

Seriously.  You two may want to consider something that has helped us in the midst of awful situations: go out and have some fun some nights and try to forget about all of this.  I know it's hard to do that in the midst of a tragedy, but it's also the best medicine, as folks have reminded me over the years (because I'll let the stress of it get to me). 

Now, I can help as to where this is headed, as I have experience dealing with (lots of) conflicts and unreasonable situations.  Actions speak louder than words, and this started with outright fraud and seizure of things that DotL (for short) had no business taking. 

It's headed towards outright fraud and theft.  She's going to camp on the estate, control it, and drain every thing of any possible value.  It's already underway. 

The estate will continue on until she converts everything that she possibly can into cash for herself, the estate goes bankrupt, and things get seized.  Her cash problems will only hasten the speed of the theft. 

This is someone who does what she wants, not someone who cares about paperwork, laws, and rules--that much she has shown you.  I hate to tell you this, but to prepare yourself, I would prepare for maximum ugly here and start establishing those boundaries so that you can stay out of and above the drama. 

Eventually, you're likely to need hard no-contact rules.  Why let her drag your own emotional lives down, rather than shut her off for periods of time, and/or mediate it through a lawyer/trusted friend/someone else/ignore her completely, so that you can stay away from it all.  That path is going to get increasingly attractive over time. 

As I see it, there are two paths here: SO can either jump in, take over the estate, and fight it out (or, rather, employ the lawyers to do so), which would be a large emotional lift and expensive due to DotL and her inevitable shenanigans.  Or you both can walk away, let her trash it all, ignore it all as it circles the drain, but preserve more of your peace and sanity.  And nothing is worth more than peace and sanity...once you don't have it anymore. 

Anyway, I'm sorry once again and wish you nothing but the best in dealing with a truly awful situation.  There's nothing like death and money to bring out the worst in some people.  But thankfully you two have each other to get through this and stay above the fray.

Thanks again for this. We decided to go on vacation to a tropical paradise this past weekend . . . that was a great idea!

Your predictions are so spot on.

...


Thank you @Zamboni and I'm glad something I said was helpful.  I hope things improve for you! 

Once again, I'm really sorry you're dealing with all this. 

I still can't believe that crazy turn with the will: yet more evidence of my theory that God has a sense of irony. 

Having been through awfulness, there is one lone upside of dealing with crazy people: it leaves you in a situation to (hopefully) share something of use to someone like you who's just now in the midst of crazy, in hopes of helping you pull through in a better fashion without having to learn some things the hard way.  I'm impressed that Mr. Z is already no-contact; you both are ahead of the situation and that will serve you well.

Zamboni

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2758 on: October 07, 2021, 02:05:26 AM »
Hahaha.  Did I mention we need to be adults? We gotta figure out life insurance too. My old workplace had an option. But now neither of our workplaces offer it.

Tbh, temporary foster care would be preferable to my closest (physical proximity) relative - my mother - swooping in for temporary custody.

Yeah, buying something like life insurance can seem overwhelming. How do you know if you are getting a good deal?

But you are young, so this is the cheapest time for you both to get something like 20 year term life insurance (the kind that will be there to provide adequate resources for your child if something happens.) Often for younger adults there is a short health questionnaire asking about things like smoking but no physical exam, so it isn't a big deal to get it.

My advice is to just pick an amount of coverage you want (we went with $1 million for each of us) and a term length you want (we went with 20 years because we were slackers and our youngest was already 3 years old) and get quote from three places. Maybe start with the company that provides your car or home insurance first?
As far as picking some other reputable companies for quotes, Nerd Wallet even has a little estimate calculator and did the legwork for you.
https://www.nerdwallet.com/blog/insurance/term-life-insurance/

Then you'll definitely need a will because you'll need to name who will have custody and who will MANAGE THAT MONEY for your offspring . . . the custody and money management doesn't have to be the same person. I actually think it's better if it is different people, but your mileage may vary. Which reminds me that our local credit union also offers basic estate planning and referrals for wills. That's another place you could ask about it.

Good luck!

I still can't believe that crazy turn with the will: yet more evidence of my theory that God has a sense of irony. 

Having been through awfulness, there is one lone upside of dealing with crazy people: it leaves you in a situation to (hopefully) share something of use to someone like you who's just now in the midst of crazy, in hopes of helping you pull through in a better fashion without having to learn some things the hard way.  I'm impressed that Mr. Z is already no-contact; you both are ahead of the situation and that will serve you well.

It's not his first rodeo with DotLWaT . . . this was just the least avoidable situation. He was already very low contact out of self-preservation. The illness and death just gave her (in her mind) lots of reasons she needed to contact him over and over. Her machinations to be in charge of the estate management is just an extension of that. 

During the grave illness and immediately afterwards, he had to balance what he needed to do for the deceased and his other relatives with his desire to not interact with DotLWaT.

Sugaree

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2759 on: October 07, 2021, 06:16:07 AM »
This is a cautionary tale for parents leaving their children money. In my opinion, the child didn't do anything wrong. However, they were not mature enough and/or not emotionally ready to handle an inheritance of 250K.

My brother-in-law shared a story of a mutual friend who broke up with their girlfriend. The girlfriend was in their early to mid 20's and was gifted 250K of life insurance when her mom died a few years ago. She is a college grad and has a full-time job. Before the death she was able to fully support herself. However, after the death she was emotionally devastated and spent 200K of the 250K over the course of 3 years. She has nothing to show for it other than a car. At one point, she owned two cars. However, she has since sold the second car. 

What type of guard rails could you put up for your children to try to avoid this? Can anything be done?

I've seen this in action with a close friend.  I estimate that she's blown through at least $500k of life insurance money in the last three years since her husband died.  Some decisions weren't that bad, like paying off her house and buying a rental property.  Some were horrible, like the in-ground heated pool or vehicle large enough that each kid has their own zip code inside of it, or the yearly trips to Disney. 

It's definitely had an impact on how I want my estate plans to look.  My kid's guardianship will be separated from the money.  My parents would be the current choice for guardianship, but a trustee would release funds at regular intervals.  I'm not saying that my parents would have him living under the stairs like Harry Potter, but I bet he'd end up taking a whole lot of cruises on his dime. 

TomTX

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2760 on: October 07, 2021, 08:35:50 AM »
Even cheaper than Costco, if you don't require varnish:
https://mountmichael.org/mount-michael-abbeys-caskets/

Ha, if you want cheap - I've been clear that I'm perfectly happy (and would actually prefer) if someone wants to slap together a box from the plywood and lumber I have in the garage. Then invite guests to draw/paint/whatever on it.

In a nod to the old tradition of having a bell, perhaps I should ask to be buried with my bicycle bell.

Britan

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2761 on: October 07, 2021, 09:00:56 AM »
@Zamboni thank you so much for this! Still feels a little overwhelming, but less so, since I have somewhere to start. A narrow list of 3-4 companies off the Nerd Wallet list, to get quotes from sounds manageable. And in a weird way Im glad to know Im not the only one who put it off.

Also good luck with DotLW. I too have no-contact relatives, so I have much sympathy for anyone else in a similar position.

Zamboni

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2762 on: October 07, 2021, 09:19:09 AM »
^TomTX, You should definitely be buried with your bicycle bell!

It's definitely had an impact on how I want my estate plans to look.  My kid's guardianship will be separated from the money.  My parents would be the current choice for guardianship, but a trustee would release funds at regular intervals.  I'm not saying that my parents would have him living under the stairs like Harry Potter, but I bet he'd end up taking a whole lot of cruises on his dime. 

I share this issue, and so I gave the purse strings to my stingiest relative. She's not great at investing, but she's not a spender, so my hope was that she would just follow my lead on where to keep it parked in index funds. I thought about having my local credit union act as trustee. They charge 1% per year to manage the estate, releasing funds only for the health, education, welfare, and maintenance of the child.

Otherwise, yeah, in the hands of other relatives there would be "family" cruises. And home remodels. And new bigger cars. I don't begrudge someone who is taking care of my kids having money to be comfortable, but odds that it would be wiped out before the kids reached adulthood are high.

I've seen plenty of advice to delay giving inheritance to young adult children. Sometimes the advice is given with caveats like "they will meet some gold digger who will then divorce them and take half the money." I even had my will set up that way for awhile, a delay for full disbursement until they were 30 years old. However, I've also seen plenty of examples of people in their 40's, 50's, and 60's who are spendthrifts and will blow through huge amounts in no time. There are even TV shows about it like Money Moron and Til Debt Do Us Part.

So, now that my kids are young adults, they will just get it directly. I updated my will when they turned 18 to just give it straight to them because the named trustee is starting to have memory problems. I don't have any other viable trustee options in my family. So it's straight to the young adult kids or a trustee like a lawyer or bank who will take a cut.

This weekend I'm going to work on updating my estate planning and I will write both children letters to put in my estate planning portfolio. That way my "wishes" for what they do with the money will be clear: hookers and blow.

Just kidding. I probably will write something like "take 5-10% of the money and get yourself a limited amount of some discrete fun things you really want right now, like maybe a vacation or vehicle or furniture or some clothes, etc. Remember me while you are living well enjoying that! Then the party is temporarily over. Please keep the rest parked in passive Vanguard stock index funds using the advice from here, here and here. Don't touch the principal! Let's this money grow from this little pile to a giant pile in 10-20 years by riding out dips in the market without meddling. That's what Warren Buffet wants for his children, and that's what I want for you."

But, after all, I'll be dead, so I'll just have to trust that they absorbed some common sense about how to manage money from our conversations and from watching how my financial situation improved over time. They already have Vanguard Roth IRA's, after all.

DadJokes

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2763 on: October 07, 2021, 09:54:38 AM »
Even cheaper than Costco, if you don't require varnish:
https://mountmichael.org/mount-michael-abbeys-caskets/

Ha, if you want cheap - I've been clear that I'm perfectly happy (and would actually prefer) if someone wants to slap together a box from the plywood and lumber I have in the garage. Then invite guests to draw/paint/whatever on it.

In a nod to the old tradition of having a bell, perhaps I should ask to be buried with my bicycle bell.

I wish to be buried with a machete, just in case I come back as a zombie.

RetiredAt63

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2764 on: October 07, 2021, 10:42:48 AM »
Even cheaper than Costco, if you don't require varnish:
https://mountmichael.org/mount-michael-abbeys-caskets/

Ha, if you want cheap - I've been clear that I'm perfectly happy (and would actually prefer) if someone wants to slap together a box from the plywood and lumber I have in the garage. Then invite guests to draw/paint/whatever on it.

In a nod to the old tradition of having a bell, perhaps I should ask to be buried with my bicycle bell.

I wish to be buried with a machete, just in case I come back as a zombie.

Wouldn't a hand axe or hatchet do better for chopping your way out of the coffin?

Hmm, I was planning on cremation, but how do I reincarnate as a zombie if I am just a pile of ashes?

TomTX

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2765 on: October 07, 2021, 11:02:29 AM »
Even cheaper than Costco, if you don't require varnish:
https://mountmichael.org/mount-michael-abbeys-caskets/

Ha, if you want cheap - I've been clear that I'm perfectly happy (and would actually prefer) if someone wants to slap together a box from the plywood and lumber I have in the garage. Then invite guests to draw/paint/whatever on it.

In a nod to the old tradition of having a bell, perhaps I should ask to be buried with my bicycle bell.

I wish to be buried with a machete, just in case I come back as a zombie.

Okay, I am really fond of my machete. Hm.

DadJokes

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2766 on: October 07, 2021, 12:40:00 PM »
Even cheaper than Costco, if you don't require varnish:
https://mountmichael.org/mount-michael-abbeys-caskets/

Ha, if you want cheap - I've been clear that I'm perfectly happy (and would actually prefer) if someone wants to slap together a box from the plywood and lumber I have in the garage. Then invite guests to draw/paint/whatever on it.

In a nod to the old tradition of having a bell, perhaps I should ask to be buried with my bicycle bell.

I wish to be buried with a machete, just in case I come back as a zombie.

Wouldn't a hand axe or hatchet do better for chopping your way out of the coffin?


Maybe I should go for a mausoleum then.

Wolfpack Mustachian

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2767 on: October 07, 2021, 01:14:11 PM »
Even cheaper than Costco, if you don't require varnish:
https://mountmichael.org/mount-michael-abbeys-caskets/

Ha, if you want cheap - I've been clear that I'm perfectly happy (and would actually prefer) if someone wants to slap together a box from the plywood and lumber I have in the garage. Then invite guests to draw/paint/whatever on it.

In a nod to the old tradition of having a bell, perhaps I should ask to be buried with my bicycle bell.

I wish to be buried with a machete, just in case I come back as a zombie.

Wouldn't a hand axe or hatchet do better for chopping your way out of the coffin?

Hmm, I was planning on cremation, but how do I reincarnate as a zombie if I am just a pile of ashes?

I thought they were being considerate of others and providing a means nearby for someone to dispatch them  if necessary...

ixtap

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2768 on: October 07, 2021, 01:19:08 PM »
Even cheaper than Costco, if you don't require varnish:
https://mountmichael.org/mount-michael-abbeys-caskets/

Ha, if you want cheap - I've been clear that I'm perfectly happy (and would actually prefer) if someone wants to slap together a box from the plywood and lumber I have in the garage. Then invite guests to draw/paint/whatever on it.

In a nod to the old tradition of having a bell, perhaps I should ask to be buried with my bicycle bell.

I wish to be buried with a machete, just in case I come back as a zombie.

Wouldn't a hand axe or hatchet do better for chopping your way out of the coffin?

Hmm, I was planning on cremation, but how do I reincarnate as a zombie if I am just a pile of ashes?

I thought they were being considerate of others and providing a means nearby for someone to dispatch them  if necessary...

I thought they were planning on being the baddest ass zombie...

So how do all of those urban zombies get out of their sealed coffins in cement vaults? Doesn't seem like a hatchet nor a machete is going to be much use against a steel coffin nor the cement vault...

rpr

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2769 on: October 07, 2021, 05:12:33 PM »

partgypsy

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2770 on: October 09, 2021, 09:32:04 PM »
I was surprised how much it cost, considering there was no funeral (there was graveside service). The plot was already paid for. We did purchase a solid wood casket as that is customary but from another company so "reasonable". 

https://www.costco.com/funeral-caskets.html
I have a membership! But we were on a time crunch. We did purchase a nice casket from "best price" caskets that was flown up in time for all the preparations. Recommend.

okonumiyaki

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2771 on: October 11, 2021, 02:42:38 AM »
Zamboni - has anyone told the ex-spouse they are in the will?  If they have a grudge vs DotW, they may be willing to take up cudgels.  As it were.

partgypsy

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2772 on: October 11, 2021, 10:59:38 AM »
Zamboni - has anyone told the ex-spouse they are in the will?  If they have a grudge vs DotW, they may be willing to take up cudgels.  As it were.

that might be an even match : )

zolotiyeruki

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2773 on: October 11, 2021, 02:00:40 PM »
Zamboni - has anyone told the ex-spouse they are in the will?  If they have a grudge vs DotW, they may be willing to take up cudgels.  As it were.

that might be an even match : )
Zamboni and the other sane siblings could sell tickets, as a way of getting what they deserved from the estate in the first place! :P

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2774 on: October 11, 2021, 06:14:25 PM »
I'd agree that paying out smaller portions over time and raising money-smart adults are the best two options.

Yeah. If you plan on still having wealth when you die, you should plan like a wealthy person and prepare your heirs. You can either raise smart kids (not always replicable, but worth the effort) or you can assume they will be dumb and force a trust on them.

Now, how are they going to raise their own kids (your grandkids) if they only "magically" get some trust money when they are 40 years old? Good money practices have to become a multi-generational family strategy.

Otherwise:
Fu Bu Guo San Dai ( 富不过三代)

Wealth does not pass three generations...

Zamboni

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2775 on: October 11, 2021, 11:10:13 PM »
Zamboni - has anyone told the ex-spouse they are in the will?  If they have a grudge vs DotW, they may be willing to take up cudgels.  As it were.

I doubt it. Ex-spouse and DotW have gone at each other before and tried to get people to take sides, so it wouldn't be anything new.  Everyone else is just tired of their drama.

Ex-spouse is elderly and lives in a flood-prone very low rent apartment. Therefore, ex-spouse actually needs a home and food money, whereas everyone else bickering over the scraps really does not. I'm staying out of it, though.

Fi(re) on the Farm

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2776 on: October 12, 2021, 06:50:40 AM »
The attorney who advised me, when my daughter was one and I got my first will, set up a revocable trust with my assets rolling over to that trust upon my death.  (A trust can be named as the beneficiary for life insurance, investment accounts, etc.)  I had a friend willing to be trustee and the terms (again recommended by the attorney) provided that until my daughter was 26 the trustee was in charge of the money and could use it to support her and for things like college and for travel. At 26 she would get 25% of the remaining money, at 30 she would get 30% of the remaining money, at 35 she would get 50% and the rest at age 40.  I was always very responsible with money so I was prepared to have it go to her at 25, but the attorney advised me that no one can predict how a one year old will be with money and my assets were likely to much higher by the time of my death.

My ex-husband is notoriously bad with money. When his mother died 5 years ago the estate was over a million. Ex-SIL, who was the executor, got her payout of the estate immediately but the will  specified that my ex, who was 56 at the time, get his money in 4 equal payments on the anniversary of her death minus 100k for my kids. He blew through the money every year before the next payment and he would call his sister screaming that he needed the money. Needless to say ex-SIL no longer speaks to him.

partgypsy

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2777 on: October 13, 2021, 06:02:14 AM »
So, is there a recommended way to set up trusts for someone who won't be responsible with money? I've seen all kinds of different payout ages and frequency of payment. Unless the person gets a monthly stipend for life it seems like there is no way to protect against someone blowing through money, even though I agree one lump payment seems the worst of all. I wonder if there is a happy medium, that is less work for an executor but give the person "training wheels" so to speak. 
« Last Edit: October 13, 2021, 06:09:10 AM by partgypsy »

SwordGuy

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2778 on: October 13, 2021, 06:23:28 AM »
So, is there a recommended way to set up trusts for someone who won't be responsible with money? I've seen all kinds of different payout ages and frequency of payment. Unless the person gets a monthly stipend for life it seems like there is no way to protect against someone blowing through money, even though I agree one lump payment seems the worst of all. I wonder if there is a happy medium, that is less work for an executor but give the person "training wheels" so to speak.

The only other approach I know of is the film "Brewster's Millions".   But the person receiving the money had the capacity to learn from it, and the willful lack of that capacity is why most plans fail.    Even monthly payments can be squandered in 2-4 days leaving the rest of the month with no money.

former player

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2779 on: October 13, 2021, 06:36:49 AM »
So, is there a recommended way to set up trusts for someone who won't be responsible with money? I've seen all kinds of different payout ages and frequency of payment. Unless the person gets a monthly stipend for life it seems like there is no way to protect against someone blowing through money, even though I agree one lump payment seems the worst of all. I wonder if there is a happy medium, that is less work for an executor but give the person "training wheels" so to speak.
If you haven't managed to "train" someone in your lifetime then expecting someone else to succeed where you have failed is unreasonable.

There is such a thing as a "discretionary trust" which means that the trustee (who may or may not be the same person as an executor) can decide how much money is disbursed, when and for what purpose, and your wishes can be taken into account by the trustee (eg money for education and housing only before a certain age and after that at the trustee's discretion).  It's a heavy burden on someone though to make them the regulator of someone else's chaotic life.

talltexan

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2780 on: October 13, 2021, 07:04:29 AM »
I imagine that there are also problems where the trustee may not be up to the job (i.e. it's an uncle or family friend who is aging, or increasingly can be manipulated by the trustee).

ixtap

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2781 on: October 13, 2021, 07:47:18 AM »
I have friends who have decided to leave their somewhat wayward adult daughter a lump sum, with the vast majority of their estate going to charity. I am FI and I would still consider the lump sum significant, and last I knew 4% would be roughly equal to the offspring's income, so it isn't like they are cutting her off. Just hoping to limit the squandering.

PhilB

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2782 on: October 13, 2021, 08:49:37 AM »
So, is there a recommended way to set up trusts for someone who won't be responsible with money? I've seen all kinds of different payout ages and frequency of payment. Unless the person gets a monthly stipend for life it seems like there is no way to protect against someone blowing through money, even though I agree one lump payment seems the worst of all. I wonder if there is a happy medium, that is less work for an executor but give the person "training wheels" so to speak.

The only other approach I know of is the film "Brewster's Millions".   But the person receiving the money had the capacity to learn from it, and the willful lack of that capacity is why most plans fail.    Even monthly payments can be squandered in 2-4 days leaving the rest of the month with no money.

Or worse, that income stream can probably be borrowed against so that soon all future income ends up going straight to creditors.

As former player says, if you haven't managed to teach someone good money habits whilst you're alive, you're unlikely to come up with an arrangement that will do so after you're dead.

sonofsven

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2783 on: October 13, 2021, 10:04:33 AM »
Not too much drama, but my partner's mother just informed her that she was changing her will.

Her husband (my partner's step father) passed four years ago and at that time the family was told the estate would be split up (after the passing of partner's mother) amongst all the surviving children and grandchildren equally.

So my partner and her daughter: two shares.
Her half sister and husband and three children: five shares.
Her half brother and wife and two children: four shares.
I thought this was kind of a silly way to go about it, I guess I just assumed that an inheritance would go to the next generation who would add it to their stash and then that would go to their children, etc.

I also thought it was unfair to my partner, but I'm biased, and of course people get to make their own decisions with their money so I kept my mouth shut. I did wonder if this was a Mormon thing as the deceased came from a Mormon family.

So the change is that the estate will be split equally amongst the three surviving children, exactly as I thought it should be from the start.

Turns out that the driver for the original plan was one of the grandchildren is "on the spectrum", lives with his parents in his mid twenties and will likely never be self supporting and this was a way to mitigate that.

Surviving mother is smart with money and has made other plans for the grandchild to secure his future. Deceased had worked at a government nuclear facility and surviving spouse and one daughter  (the mother of the grandchild in question) received a fairly large settlement upon his death from cancer, they combined this money for this grandchild exclusively.

Well, there is a bit of drama: deceased had a secret "love child" from an affair prior to his second marriage to partner's mother that nobody knew about until the details were laid out just prior to his passing. LC is a delusional alcoholic, unfortunately.
Love Child could also receive her own government settlement but she refused to work with my partners mother when she reached out and sent her the forms she needed to fill out because she thinks everyone is trying to take advantage of her.

FIPurpose

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2784 on: October 13, 2021, 11:54:10 AM »
I think splitting among the children/grandchildren is a good idea. Otherwise, the parent with only one child ends up being far wealthier than the other grandchildren and that might foment some distrust among the family.

There is some tax advantage to skipping generations if there's a lot of money in the estate, but I'm assuming they weren't close to that line.

At the age most people are living to now (SO and I have 5 grandparents and 4 parents still living between the 2 of us) So I really don't expect to inherit anything until I'm passed 50 or even 60 years old. I'd have waay more than enough money and if my parents wanted to skip me on inheritance and go straight to the grandchildren / charity, I think that would be a fine decision.

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2785 on: October 13, 2021, 12:02:34 PM »
I think splitting among the children/grandchildren is a good idea. Otherwise, the parent with only one child ends up being far wealthier than the other grandchildren and that might foment some distrust among the family.

There is some tax advantage to skipping generations if there's a lot of money in the estate, but I'm assuming they weren't close to that line.

At the age most people are living to now (SO and I have 5 grandparents and 4 parents still living between the 2 of us) So I really don't expect to inherit anything until I'm passed 50 or even 60 years old. I'd have waay more than enough money and if my parents wanted to skip me on inheritance and go straight to the grandchildren / charity, I think that would be a fine decision.


And on the other side, the parent who has only one child may feel like they're being punished for the choices of their sibling. 

PDXTabs

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2786 on: October 13, 2021, 12:18:08 PM »
At the age most people are living to now (SO and I have 5 grandparents and 4 parents still living between the 2 of us) So I really don't expect to inherit anything until I'm passed 50 or even 60 years old. I'd have waay more than enough money and if my parents wanted to skip me on inheritance and go straight to the grandchildren / charity, I think that would be a fine decision.

I'm the same way. I will probably get a meaningful inheritance from my one remaining parent right when I absolutely do not need it. But you know, maybe I'll use it to take care of the less fortunate in my family.

PDXTabs

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2787 on: October 13, 2021, 12:19:26 PM »
And on the other side, the parent who has only one child may feel like they're being punished for the choices of their sibling.

Yup. In my family we tend to distribute to the children of the deceased parent. Which means that there is no incentive to crank out more kids.

FIPurpose

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2788 on: October 13, 2021, 01:23:36 PM »
I think splitting among the children/grandchildren is a good idea. Otherwise, the parent with only one child ends up being far wealthier than the other grandchildren and that might foment some distrust among the family.

There is some tax advantage to skipping generations if there's a lot of money in the estate, but I'm assuming they weren't close to that line.

At the age most people are living to now (SO and I have 5 grandparents and 4 parents still living between the 2 of us) So I really don't expect to inherit anything until I'm passed 50 or even 60 years old. I'd have waay more than enough money and if my parents wanted to skip me on inheritance and go straight to the grandchildren / charity, I think that would be a fine decision.


And on the other side, the parent who has only one child may feel like they're being punished for the choices of their sibling.

I'd like to think that my siblings wouldn't quibble, but then again only 2/4 even have children. (And I kind of assume they won't) So perhaps I'm just biased for passing on the wealth to the next generation.

I think though that it would be unfair to make the grandparents choose between fairly distributing between their children or their grandchildren. Especially if their grandchildren have been around a long time, then they love them too. And I'd like to think that if I were a grandparent, I'd want to treat all of my descendants as fairly and equitably as possible.

The number of children may be the choice of siblings, but that has a direct impact on the grandparents' legacy. Those siblings are building out the family tree, and funding that to be as healthy and taken care of as possible is important. It's in the grandparents' interest to treat them equitably, no matter whose children they are.

At the very least, giving an equal share to all parents and grandparents is a good way of splitting that baby. The children get a share that they will likely only pass to their children, and the grandchildren get a share that helps equality and also helps them get a jump start in life. (70 year old parents shouldn't need additional 6 figures, but 30 year old grandchildren will be in the perfect time in their life for needing a down payment, a business start up, or continuing education.) 30k to a 30 year old is far more valuable than 100k to a 60-70 year old imo.

zolotiyeruki

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2789 on: October 13, 2021, 02:48:17 PM »
One thing I've seen done:  The grandparents, while living, give an equal sum to each grandchild at birth, where it'll have 18 years to compound, and when the grandparents pass away, their estate is divided equally among their immediate children (i.e. grandkids' parents).  The idea is that each grandkid gets an reasonably equal benefit, the parents have to worry less about paying for college, and the parents themselves are treated equally when the grandparents pass away.

I have to say, it's kind of weird to be debating what's "fair" when dividing up money among people who didn't earn it. 

sonofsven

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2790 on: October 13, 2021, 03:02:22 PM »
I think splitting among the children/grandchildren is a good idea. Otherwise, the parent with only one child ends up being far wealthier than the other grandchildren and that might foment some distrust among the family.

There is some tax advantage to skipping generations if there's a lot of money in the estate, but I'm assuming they weren't close to that line.

At the age most people are living to now (SO and I have 5 grandparents and 4 parents still living between the 2 of us) So I really don't expect to inherit anything until I'm passed 50 or even 60 years old. I'd have waay more than enough money and if my parents wanted to skip me on inheritance and go straight to the grandchildren / charity, I think that would be a fine decision.


And on the other side, the parent who has only one child may feel like they're being punished for the choices of their sibling.

I'd like to think that my siblings wouldn't quibble, but then again only 2/4 even have children. (And I kind of assume they won't) So perhaps I'm just biased for passing on the wealth to the next generation.

I think though that it would be unfair to make the grandparents choose between fairly distributing between their children or their grandchildren. Especially if their grandchildren have been around a long time, then they love them too. And I'd like to think that if I were a grandparent, I'd want to treat all of my descendants as fairly and equitably as possible.

The number of children may be the choice of siblings, but that has a direct impact on the grandparents' legacy. Those siblings are building out the family tree, and funding that to be as healthy and taken care of as possible is important. It's in the grandparents' interest to treat them equitably, no matter whose children they are.

At the very least, giving an equal share to all parents and grandparents is a good way of splitting that baby. The children get a share that they will likely only pass to their children, and the grandchildren get a share that helps equality and also helps them get a jump start in life. (70 year old parents shouldn't need additional 6 figures, but 30 year old grandchildren will be in the perfect time in their life for needing a down payment, a business start up, or continuing education.) 30k to a 30 year old is far more valuable than 100k to a 60-70 year old imo.

I think I was just surprised because I had never heard of this idea; I can see the benefits, too, but it's not how it's been done in my family. So, different.
I wonder if maybe the deceased knows things about the other adults (all in their 50's now) that I don't? Maybe he thought some of them would waste the money? Grandmother apparently does not believe that.

I think it's interesting that she is going against what were their shared wishes. She always took the back seat, she's a traditional "stand by (behind) your man" type who believed the man should be in charge, but look now, she's taking charge and doing what she thinks is right.


FIPurpose

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2791 on: October 13, 2021, 03:19:40 PM »
One thing I've seen done:  The grandparents, while living, give an equal sum to each grandchild at birth, where it'll have 18 years to compound, and when the grandparents pass away, their estate is divided equally among their immediate children (i.e. grandkids' parents).  The idea is that each grandkid gets an reasonably equal benefit, the parents have to worry less about paying for college, and the parents themselves are treated equally when the grandparents pass away.

I have to say, it's kind of weird to be debating what's "fair" when dividing up money among people who didn't earn it.

Alternatively, you could just decide to divide your wealth into chunks of 10%, 20%, 30%, and 40%, and then just randomly assign those to different relatives.

Seeing as the standard in our society is to evenly divide the wealth among the next generation (donating a large sum to charity is also a common cultural norm), I'd say that deviating too far from the cultural norm can start to err into "unfair". And we can judge it as unfair in the same way that someone who wants their money withdrawn and then burned can be labeled "stupid" despite it being their money to do with as they please.

La Bibliotecaria Feroz

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2792 on: October 13, 2021, 05:23:47 PM »
One thing I've seen done:  The grandparents, while living, give an equal sum to each grandchild at birth, where it'll have 18 years to compound, and when the grandparents pass away, their estate is divided equally among their immediate children (i.e. grandkids' parents).  The idea is that each grandkid gets an reasonably equal benefit, the parents have to worry less about paying for college, and the parents themselves are treated equally when the grandparents pass away.

I have to say, it's kind of weird to be debating what's "fair" when dividing up money among people who didn't earn it.

I mean, yes, but it's crappy to set up a situation where some heirs feel more loved and respected because they got more money!

When my grandfather passed and the large estate of my grandparents was divvied up, my cousins split the share of their father who had pre-deceased Grandfather by many years* and the rest went to his other children/stepchildren. The grandchildren are all grown and educated but the great-grands receive yearly 529 contributions.

*Fun fact: This is because my grandfather was much younger than Grandma, and her older two sons were maybe 10-12 years younger? So my uncle was a respectable 70 when he died.

Mighty Eyebrows

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2793 on: October 13, 2021, 08:47:13 PM »
If you haven't managed to "train" someone in your lifetime then expecting someone else to succeed where you have failed is unreasonable.

Very well said.

I think though that it would be unfair to make the grandparents choose between fairly distributing between their children or their grandchildren.

We should all remember that these choices are entirely cultural. What is "fair" varies between societies and there is no objective right or wrong. Obviously, if expectations are different, then conflicts can arise.

For intestate individuals, different jurisdictions will default to different choices:
https://en.wikipedia.org/wiki/Per_stirpes

Captain FIRE

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2794 on: October 14, 2021, 08:20:45 AM »
I think though that it would be unfair to make the grandparents choose between fairly distributing between their children or their grandchildren.

We should all remember that these choices are entirely cultural. What is "fair" varies between societies and there is no objective right or wrong. Obviously, if expectations are different, then conflicts can arise.

For intestate individuals, different jurisdictions will default to different choices:
https://en.wikipedia.org/wiki/Per_stirpes

It's also up to the decedent to determine what they think is right (as in, what they want to do), regardless of whether it's fair.  (On the flip side, a person estate planning ought to realize that if they don't provide in a way that is deemed generally fair, whether right or wrong that relationships amongst their heirs could be irreparably damaged and it may impact how a descendant feels about the giver/their relationship - "how loved" they feel they were.)

For me, I personally default towards inheriting per stirpes, where the inheritance is split by child.  It's seems wrong to me that if a child were deceased, their children would receive no share in a per capita split.  But, I recognize not everyone feels that way.  If I wanted to skip a generation, I would give my grandkids their "portion" of their child's share, rather than give equally at the grandchild level.  (That said, I might likely give equal money for a 529 at a grandchild's birth.)

Sugaree

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2795 on: October 14, 2021, 08:56:31 AM »
I think splitting among the children/grandchildren is a good idea. Otherwise, the parent with only one child ends up being far wealthier than the other grandchildren and that might foment some distrust among the family.

There is some tax advantage to skipping generations if there's a lot of money in the estate, but I'm assuming they weren't close to that line.

At the age most people are living to now (SO and I have 5 grandparents and 4 parents still living between the 2 of us) So I really don't expect to inherit anything until I'm passed 50 or even 60 years old. I'd have waay more than enough money and if my parents wanted to skip me on inheritance and go straight to the grandchildren / charity, I think that would be a fine decision.


And on the other side, the parent who has only one child may feel like they're being punished for the choices of their sibling.

I'd like to think that my siblings wouldn't quibble, but then again only 2/4 even have children. (And I kind of assume they won't) So perhaps I'm just biased for passing on the wealth to the next generation.

I think though that it would be unfair to make the grandparents choose between fairly distributing between their children or their grandchildren. Especially if their grandchildren have been around a long time, then they love them too. And I'd like to think that if I were a grandparent, I'd want to treat all of my descendants as fairly and equitably as possible.

The number of children may be the choice of siblings, but that has a direct impact on the grandparents' legacy. Those siblings are building out the family tree, and funding that to be as healthy and taken care of as possible is important. It's in the grandparents' interest to treat them equitably, no matter whose children they are.

At the very least, giving an equal share to all parents and grandparents is a good way of splitting that baby. The children get a share that they will likely only pass to their children, and the grandchildren get a share that helps equality and also helps them get a jump start in life. (70 year old parents shouldn't need additional 6 figures, but 30 year old grandchildren will be in the perfect time in their life for needing a down payment, a business start up, or continuing education.) 30k to a 30 year old is far more valuable than 100k to a 60-70 year old imo.

Perhaps.  In my family there is a situation where there are two siblings.  One sibling has one child while the other has four.  The sibling with four children has already received a lot in the way of economic outpatient care, including two mostly-funded international moves, more than one graduate degree, and significant help buying a house.  The sibling with one child has received some financial support, but is also the one that is local to the parents and has provided a lot of practical support while the parents have been ill.  That one already feels as if their sibling is the "favorite" and splitting the estate 5 ways where one branch gets 4/5 as opposed to 1/2 would just be seen as a final slap in the face. 

ixtap

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2796 on: October 14, 2021, 09:20:16 AM »
We don't equate our parents' money with their love. When it comes to EOC, we figure that their money has an inverse correlation with respect.

One way my parents show that respect is by treaty us as near equals on joint vacations. They wouldn't even think of inviting my siblings on a cruise without offering to pay for them. I say near equals because Dad still loves to pay for dinners whenever he can.

If either my parents or ILs decide to disinherit or lesser inherit us, it will be because they worry more about our siblings, which is not the same as loving them more. Currently, they are just as worried about our siblings blowing through an inheritance as any other outcome, so they figure they might as well include us in an inheritance. ILs do seem to hope that we would somehow use it to the benefit of the family, but my parents have absolved me of being responsible for my financially irresponsible siblings.

FIPurpose

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2797 on: October 14, 2021, 09:26:14 AM »
I think splitting among the children/grandchildren is a good idea. Otherwise, the parent with only one child ends up being far wealthier than the other grandchildren and that might foment some distrust among the family.

There is some tax advantage to skipping generations if there's a lot of money in the estate, but I'm assuming they weren't close to that line.

At the age most people are living to now (SO and I have 5 grandparents and 4 parents still living between the 2 of us) So I really don't expect to inherit anything until I'm passed 50 or even 60 years old. I'd have waay more than enough money and if my parents wanted to skip me on inheritance and go straight to the grandchildren / charity, I think that would be a fine decision.


And on the other side, the parent who has only one child may feel like they're being punished for the choices of their sibling.

I'd like to think that my siblings wouldn't quibble, but then again only 2/4 even have children. (And I kind of assume they won't) So perhaps I'm just biased for passing on the wealth to the next generation.

I think though that it would be unfair to make the grandparents choose between fairly distributing between their children or their grandchildren. Especially if their grandchildren have been around a long time, then they love them too. And I'd like to think that if I were a grandparent, I'd want to treat all of my descendants as fairly and equitably as possible.

The number of children may be the choice of siblings, but that has a direct impact on the grandparents' legacy. Those siblings are building out the family tree, and funding that to be as healthy and taken care of as possible is important. It's in the grandparents' interest to treat them equitably, no matter whose children they are.

At the very least, giving an equal share to all parents and grandparents is a good way of splitting that baby. The children get a share that they will likely only pass to their children, and the grandchildren get a share that helps equality and also helps them get a jump start in life. (70 year old parents shouldn't need additional 6 figures, but 30 year old grandchildren will be in the perfect time in their life for needing a down payment, a business start up, or continuing education.) 30k to a 30 year old is far more valuable than 100k to a 60-70 year old imo.

Perhaps.  In my family there is a situation where there are two siblings.  One sibling has one child while the other has four.  The sibling with four children has already received a lot in the way of economic outpatient care, including two mostly-funded international moves, more than one graduate degree, and significant help buying a house.  The sibling with one child has received some financial support, but is also the one that is local to the parents and has provided a lot of practical support while the parents have been ill.  That one already feels as if their sibling is the "favorite" and splitting the estate 5 ways where one branch gets 4/5 as opposed to 1/2 would just be seen as a final slap in the face.

I definitely depends on the family's circumstances. I'm not saying this would work out for all families and circumstances. But the method suggested would be splitting it evenly 7 ways (basically 70/30), or heck you could do a double share to the children and go 9 ways (66/33 split). But yes, no matter how you slice the cake, someone isn't going to like it and everyone has to just deal with what they're given at the end of the day.

However, this wouldn't make sense if the grandparents die relatively young and not all of their grandchildren are born yet. I was saying that skipping a generation seems to make more sense due to increasing lifespan. The children are more likely to do nothing with the money but sit on it til they die, and the grandchildren would be in the exact spot to do something useful with the money.

This isn't true for every family. If you know you won't be making it to 70, perhaps the typical per stirpes is the best decision. But but if all the direct heirs are over 70, maybe it would be best to skip them. (Kind of like how maybe Charles just shouldn't bother becoming King). But then again, perhaps your descendants are all snots and you want to give your money to some friends or a charity. That could make sense given certain circumstances.

TMB

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2798 on: October 15, 2021, 05:54:48 PM »

Or worse, that income stream can probably be borrowed against so that soon all future income ends up going straight to creditors.



You can insert a spendthrift clause into the trust, which, if operable in that state, basically means that creditors can't come after the future income directly.  Of course, they can still try to grab the money once distributed.

Also, you could set up a trust where the trustee directly pays for certain obligations which also limits the ability of foolish people to bargain away future interests.

DadJokes

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Re: Inheritance Drama: You Got Any? Stories Wanted.
« Reply #2799 on: October 18, 2021, 09:10:49 AM »
This story is developing, and I'm hearing everything secondhand from one of the interested parties, so take it all with a grain of salt.

My wife's uncle (we'll call him Pop) died a few weeks ago. That's no surprise, as he was 60 and 300+ pounds, but of course no will. Wife's cousin (we'll call her DQ for drama queen, as drama seems to follow her) calls my wife to vent about everything her dad's wife (we'll call her SM for step mom) has been doing.

SM went and hired an attorney without consulting anyone else in the family. I guess that's no big deal, but it seems a little shady to not include the deceased's daughter in the conversation. Yesterday, my wife hung out with DQ to let her vent. During that time, SM called DQ, and the two engaged in a 15 minute screaming match, largely over the issue of getting a lawyer and SM not communicating with DQ about it. All of this happens on speaker phone, with my poor anti-conflict wife stuck in the car listening to it all.

Pop's gravesite was already paid for, but SM wants a plot next to him, which costs $950 to reserve. She doesn't have $950, but apparently the money can come directly out of the life insurance policy on Pop. Pop's life insurance has a 50/50 payout between SM & DQ. However, because the $950 comes directly out of the life insurance policy, it's happening before the 50/50 split, meaning that DQ is losing out on $475 so that SM can get the plot adjacent. That doesn't pass the smell test to me, but I'm not much of an expert on life insurance and funeral planning. I'm hoping that DQ is misinterpreting when the money comes out of the policy.

SM show's up at Pop's mom's house. She asks Pop's 50 year-old mentally-handicapped brother for the key to the garage to get Pop's stuff (tools and such). Thankfully, brother doesn't know where it is. Then SM asks Pop's mom (who has Alzheimer's and also isn't aware of things) and gets the key from her. She proceeds to take a bunch of stuff out of the garage. Pop's sister, who is the caretaker for their mom and mentally-handicapped sibling, finds out about it, goes to the garage and finds that SM took nearly everything out of the garage, including things that weren't Pop's. So sister called the police on SM yesterday.

Pop ran a large farm. He had a lot of equipment with debt on it all. The proceeds from the farm barely covered the debt payments. I know for a fact that Pop had discussed letting DQ's husband take over running the farm (but again, no will). SM has the keys to the equipment and isn't turning them over. It's approaching harvest time, and missing the harvest will result in a lot of lost revenue.

I don't imagine that Pop had much of an estate, aside from the farm itself, which is saddled with debt.