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We are not trying to spend it all but we are also not trying to leave an inheritance. We are completely neutral on the matter. Goal #1 for us is to not run out of money. We have a will so we expect to leave money but a lot can happen between now and when we are 6' under so we just take one step at a time.
because of sequence risk if you are living off a portfolio there can be a 15 year difference in how long the money lasts just based on the order gains and losses come in .
at 4% inflation adjusted draw rates there can be a wide span in outcomes and because of that a fairly large chunk of money may be left if you do not take raises and outcomes are better than worst case .
so money for heirs is likely built in because quite a bit of powder has to be kept dry through most of retirement like it or not . .
While we're doing well in retirement, our grown kids are, unfortunately, just keeping their heads above water. (One has serious health issues.) I see our nest egg as eventually being their nest egg and de facto "retirement plan." We're not interested in "toys" and lavish expenditures.
The only threat I can imagine re: passing our money on, is long term care issues. I distrust LTC insurance, even after insuring most other aspects of my life. But I refuse to contemplate spending down my lifetime's accumulated assets in some nursing home when I'm at the point of being unable to care for myself. There are pills and assisted suicide options aplenty.
At age 11, I received $10,000 of General Motors stock, older brother the same, from grandfather. Parents paid for college for both of us. We each signed up for the service. (Brother - officer in Army, I went into the Navy)
I paid for our only daughter's 4 year college nursing degree as well as her wedding in Maui.
Purchased 200 shares of a stock in 1985 at $185.00 share and put in her name (generates $10K year in dividends) This is now worth $1700 share. It is in a trust, which my wife & I are trustees. I plan to use for the benefit of grandchildren's education.
Hopefully wife and I will have enough to live out our years (age 70/66). Anything left goes into trust for daughter.
God has blessed our family the last three generations, an we have all worked hard thru-out our lives to care for what He has given us.
I guess I am sick, but these two stories always made me feel content about the way people handled their estates.
Leona Helmsley...the nephew thought he was going to get rich when she died. She left most of it to charity and the dog. IIRC the nephew got a token and an "I always hated you for being a leech" mention from Leona--who was not a nice person to begin with.
Elderly woman in the town where I grew up. Husband had a HUGE invention and she was loaded when he died. Kids and grand kids leached off grandma at every turn. Couldn't wait for granny to keel over so they could get it all.
Turns out granny had been using pledged stock to borrow money from the bank to fund the kids/grandkids lifestyle. When she died, the stock and her huge house paid for the loans. Net estate? Zero.
I don't worry much about the kids getting my estate. Turned around, if I was broke/destitute, I would fall over dead if one of the kids came to my rescue.
I know they have it all figured out exactly what they "think" they are going to get when I die.
SURPRISE! As of this writing, they are not mentioned in the will.
Didn't your lawyer tell you, you have to mention them even if it is to say, I am intentionally leaving my son, so and so, out of this will. or some such comment. Otherwise it is easier for the to contest the will.
My Mother died broke and my only "inheritance" was not having to support her any longer. My Dad, on the other hand, was an industrial chemist who loved his work and was forced to finally retire in his 70s. I often think that retiring is what killed him. Although he lived very simply, he left my sister and I about $ 250,000 each. As for me, I'll be 65 in June with no plans to close my business anytime soon. I also live pretty simply compared to my income, like my Dad. Unless I buy some huge ridiculously expensive house that I don't need or start driving new Bentleys, I can never spend the money I've got. My son is my sole heir, so he stands to inherit a sizeable estate when I die. If I die tomorrow, he'd never have to work again. However, I DO have a real soft spot for that Bentley Continental convertible, so you just never know.
I would like to leave my son a nice little pile, but first and foremost my pile is to take care of my wife and me . If there is any left I want him to have it. I don't want to die broke because the time leading up to being broke will be painful and you will be depending on charity if you are broke.
Our goal is to not go broke during retirement. Assuming we accomplish this, there will be an estate of some size, small or large, for the kids after we pass.
Indications are the estate could be sizeable so we are carefully gifting money to the kids now. Better they receive some of it in their 30's when they need it to buy homes and pay off Grad School loans, rather than receive all of it in their 70's.
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