Parents should manage inheritance, estate planning expectations
Many people think about the success of their parents, and might even wonder what inheritance their parents will leave them. Parents can sometimes think completely different about leaving their children an inheritance. Some might hope to leave their children as much as possible, and some might decide to give most or all of their assets to charity.
Whatever a parent decides to have done with their assets after they die, inheritance should be a discussion that parents have with their children. It might be helpful for parents to emphasize certain values with their finances, that would be in line with the way they will handle an inheritance. This can help make discussions about inheritance less of an argument.
Children might be sadly disappointed if they are told that they aren't going to get any inheritance. While it might be wrong for them to base financial planning on receiving an inheritance, some children might be shocked to find out later in life that they aren't getting an inheritance. Instilling values of giving to charity can help lessen the shock of a parent telling their children that all the assets are going to charity.
Some parents might also discuss finances with their children and make clear that certain gifts throughout their life will count as their inheritance. Whatever a parent decides, it is a personal decision but can be easier for families to understand if expectations are set early on. Having a solid estate plan can help parents plan for many different scenarios regarding their assets and how they might be passed down to the next generation.
Source: Sacramento Bee, "Kid and Money: If you plan to leave an inheritance, manage expectations," Steve Rosen, Oct. 14, 2013.