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Old 06-02-2014, 04:36 PM
Location: ☀️ SWFL ⛱ 🌴
2,441 posts, read 1,676,474 times
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Our son is secondary beneficiary on our assets, so he will inherit whatever is left. Considering we could be gone in the next few minutes or become centenarians, trying to budget for us is tough enough let alone worrying about funding an inheritance.
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Old 06-02-2014, 04:41 PM
Location: Fort Lauderdale, Florida
9,256 posts, read 8,327,423 times
Reputation: 20165
Originally Posted by TwoByFour View Post
This is something I have been wrestling with. It is really a personal decision, not something anyone else can solve for me. But I am curious what the thoughts are of others on this topic.

We can go two different ways with our retirement savings:

(1) Invest it safely (e.g., bonds mostly) and spend down the principal. The money should last long enough if we stick to a budget. However, there will be little left for anyone to inherit. But it is very safe for us.

(2) Invest it in such a way to preserve the principal and live off the returns. This depends highly on the stock market, which is of course fickle. We could lose a lot of money if we have another meltdown like 2000, which would impact our retirement plans, maybe in a big way, maybe not. But if we invest it well there will be a lot that our heirs get.

I realize there are variations on the two extremes above. But I am curious what others are doing who have retired.
My parents are rich. My dad has worked hard his entire life, invested well, bought properties, etc.

My parents have made it very clear they are leaving their money to charitable causes which I applaud.

All the grandkids are through college and have good careers of their own.

I think they are leaving one beach house to my siblings and me to share.

My inlaws are also Post-Depression-Era-Protestant-Work-Ethic savers and are land rich. My husband I and I have talked to them until we are blue in the face about selling it and spending it to no avail.

I'm pretty sure it is going to the grandkids which is fine.

I guess my point is, spend it yourself however it makes you happy. You will not be around to see your kids and grandkids enjoy your hard earned money and your kids and grandkids would probably like to see YOU having fun with your money.
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Old 06-02-2014, 05:10 PM
71,779 posts, read 71,875,234 times
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the idea of a conservative retirement plan is the fact that your income should never have to vary. you should not be required to take a pay cut in bad times.

what should change as markets change is the amount left in your pile of money.

the end result is if things are better than you figured you will have lots left for heirs. if scenerios play out worse you may run out of money before you run out of time.

what heirs get will be determined more by markets ,interest rates and your withdrawal rate then any predicting in advance as most folks need that money to live on..

you can not predict inflation ,interest rates , negative interest rates and unexpected expenses and emergency spending.

no budget vs withdrawals can ever pan out as expected unless lots of powder is kept dry and withdrawals low.
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Old 06-02-2014, 06:57 PM
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I don't think there's any right answer to this question. It all depends on the circumstances. I used to have a great uncle that was always very generous with his wealth. He gave away thousands of dollars during his lifetime. And yet, when he died, there was enough left over to build a new hospital with his name on it.
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Old 06-02-2014, 07:00 PM
Location: USA
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I don't give much thought to leaving money for my two children. They have been adults for many years and have inherited from their paternal grandmother. It's fine if there is some of mine left for them. My parents and their dad's parents helped a lot over the years. I don't think anyone is really needing anything. How much I will have left is totally dependent on how long I live. My interest is to not become demented. Both parents lived to age 97. Mother had her wits, my dad was slightly senile.
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Old 06-02-2014, 08:10 PM
Location: Loudon, TN
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Other than my spouse I have no heirs, being childless with deceased parents. My brothers have children, who are good kids (adults) for the most part, but it is not my intent to leave them anything. My brothers all have health issues that will probably take them before I go (barring my accidental death). So I guess I better get to work on a will, I don't plan to have much left over, but I'd like to have some say in where it goes. It's not enough to change anyone's life, so I'll probably designate charities to receive it if my DH is already gone.

My DH's closest childhood friend had his life, and that of his siblings, turned to chaos because of the large inheritances they received from their father's death. I can hardly believe the level of sheer dysfunction in the family brought on by jealousy, scheming, in-fighting, and something I will call vulturism. It was truly sickening to watch. Their father would literally roll in his grave to see what his generosity started. All he wanted was to see that everyone was taken care of, but it destroyed the family. Good parents, good kids, but something twisted when money they didn't have to work for came into the picture.
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Old 06-02-2014, 09:43 PM
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I think the entire premise of this post is a bit backwards.

It's not about living in a way to leave an inheritance, it's about living in a way that you don't need to be a drain.

Personally, I don't care if I get anything from my parents(they're mid 50s) but the strain of having to take care of them in their old age could definitely be difficult financially for me.

So I don't think leaving an inheritance should really be part of the equation when you're figuring out intent. I think it should be avoiding running out and if you have any left over, that's an great surprise.

In your particular case, I would lean more towards the safer route(though at all ages it should be somewhat of a blend). The reason for riskier investments should be that you need the increased revenue stream, not because you want to end up with more after you're dead.

Let their inheritance be the fact that they didn't have to pay for your bills. That alone is a huge gift.
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Old 06-02-2014, 10:05 PM
Location: Silicon Valley
18,134 posts, read 23,019,359 times
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If your kids would actually take you into their home and care for you until you die...then, sure, leave them something. But, I think this is a rare scenario nowadays.

I'm poor and on a fixed income, but I started paying into a life insurance policy when I was in my 40's, while I qualified for a special rate. It was for $150,000. I got to the point that paying the life insurance monthly payment was difficult for me. I asked my daughter if she'd want to take over the payments, which were only $33.00/month, but made my budget difficult.

For $33/month, my daughter would eventually get $150,000. But, she chose not to take over those payments. This was my "inheritance" for my daughter, and she let it go. I don't know why she made that choice, but I can let it go without guilt now. My daughter was no longer a dependent when I got this insurance. It was simply my way of leaving her an inheritance. She chose to let it go. C'est la vie.

But, for those who need their income/savings and are struggling with the inheritance issue, I suggest life insurance as a way of leaving something. And why not ask them to help pay for it, if they can afford to?

And BTW, my daughter makes over $100,000/year. It made way more sense for her to pay the $33/month, than me on my $877/month SSI income.

After it lapsed, she asked me for the info again, which I'd been sending her for about 6 months trying to get her to take it over. Too late. Oh well.
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Old 06-02-2014, 10:10 PM
Location: Northern NJ
7,954 posts, read 7,925,518 times
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Originally Posted by TwoByFour View Post
Very true. The difference, for me, is one of intent. Are we going to make a concerted effort to leave something for heirs and relatives or take the safe route which means they will likely get far less?
Everyone should stand on their own two feet and earn their own money. I would enjoy your money and spend as much of it as you need to to be comfortable and happy. You are not responsible to leave money to anyone. And anyone who expects it and plans on it is a loser and shouldn't get a bloody dime.
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Old 06-02-2014, 10:18 PM
Location: San Antonio
7,629 posts, read 14,388,006 times
Reputation: 18712
Our goal was to enjoy life, not be a burden to our adult children, and leave what was left to them equally....that all changed with the birth of our severely autistic grandson....now we will scrimp, save and do what we can to ensure his financial needs are met. HE and HIS needs are our #1 priority now, and all our other children/grandchildren understand and accept as well as agree as a family we must meet his needs!
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