Discussing inheritance is hard.
gets Grandma's ring?" can be a touchy estate issue if Grandma never
discussed the idea with anyone while she was alive. Too often, after
someone dies, the most heated family squabbles are about personal items
that have only modest monetary value.
is one of the conclusions of the recently released Allianz American
Legacies Study. In fact, distributing personal possessions of emotional
value was five times more likely to be the greatest source of family
conflict than the division of finances according to baby boomers whose
parents are not alive.
Life Insurance Company hired Age Wave market research consultants to
design a comprehensive survey about intergenerational wealth transfer.
They surveyed about 2,500 individuals. About half were boomers (age 40
to 59) and half were from their parents' generation (age 65 and over).
research found that both boomers and the elder generation were
uncomfortable discussing the topic of leaving an "inheritance."
Discussing dollar amounts and dying is seen as being greedy.
both generations enthusiastically welcomed the idea of leaving a
"legacy" because that concept captures all facets of an individual's
life -- including family traditions and history, sharing stories,
values and wishes.
researchers found that non-financial leave-behinds -- like ethics,
morality, faith and religion -- are 10 times more important to both
boomers and elders with children than the financial aspects of a legacy
both boomers and those in their parents' generation say they are having
in-depth conversations about legacy and inheritance, most of these
conversations are not happening in a truly meaningful way.
percent of boomers and 71 percent of those in their parents' generation
say they are very comfortable discussing legacy and inheritance. Yet
only 31 percent of elders and 29 percent of boomers have actually had a
thorough discussion that includes values and life lessons, instructions
and wishes to be fulfilled, personal possessions of emotional value,
and financial assets or real estate.
The study also looked at whether elders thought estate property should be divided equally among all children.
percent of elders with a lower net worth felt that distribution should
be equal. Only 54 percent of higher net worth elders agreed.
elders with higher net worth are more likely to favour
performance-based distribution than those with lower net worth. They
would like to give more to the child that has cared for the parent and
less to the children that caused stress and conflict. Some want to
include grandchildren. Parents need to explain such unequal
distributions with their children to avoid hurt feelings and feuds.
good news is that 89 percent of the elder generation has made some
plans for legacy transfer. Furthermore, 67 per cent of elders have
sought assistance from a professional advisor.
generations look for a legacy advisor who is honest, trustworthy and
compassionate. They want a good listener and a clear communicator.
Being able to explain things easily was more important than knowledge
of how to minimize taxes.
need to have important conversations about their family legacy as soon
as possible. Parents and children who don't talk about legacy issues
may be setting the stage for feuding after the parents' deaths. They
also miss a great opportunity for sharing their thoughts on family
traditions and values.
do you begin? You can start by finding a professional advisor. Among
the designations to look for are Chartered Life Underwriter (CLU) and
Trust and Estate Practitioner (TEP). These credentials indicate the
advisor knows the basic technical aspects of estate planning. But you
will have to interview the advisor yourself to see if they have the
personal qualities you desire.