Some people are just too young to be receiving inheritances. After all, a young person might not know what to do with it. Of course, young inheritors are not the only ones who cannot handle a sudden inheritance.
Can you say “baby boomers”?
The baby boom generation is set to receive unprecedented inheritances in the coming years. Do baby boomers and retirees know what to do with their inheritances? Not always, but there is time to learn whether in Overland Park or elsewhere.
The subject of inheritance in retirement was considered in a recent MarketWatch article titled “When retirees inherit; tips for newfound wealth” The article provides some basic pointers to get you started.
For the most part, this issue is simply a case of "social reversal." Historically, retirees and inheritors have held very separate roles. Retirees planned inheritances for their inheritors, but they were not themselves inheritors!
With age and population groups moving through time as they are today, baby boomers are about to receive the greatest generational wealth transfer in recent history. The essential nugget of wisdom to glean from the original article, however, is to force yourself to a calm moment and some further planning.
Retirees have less time to make the best of an inheritance. Nevertheless, many retirees are facing some very difficult financial decisions themselves. Long-term care and future health care costs are good for starters. Using the inheritance correctly and wisely is the key.
So, if you are only holding the inheritance for a short time yourself, what does that mean for your existing estate plans? This unprecedented wealth transfer has the potential to be a blessing or a curse. Are you ready? Which will it be?
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
Reference: MarketWatch (July 16, 2013) “When retirees inherit; tips for newfound wealth”