More than a third of wealthy baby boomers in Texas and elsewhere across the country have not discussed their finances with their children. In addition, these potential beneficiaries may not be aware that their parents may be planning to give much of their wealth to charity after their death rather than leaving it to the children. In fact, only 55 percent of baby boomers think that it is very important to leave an inheritance to their heirs at all.
Many baby boomer-aged parents are rethinking creating an estate plan that leaves significant wealth to their children. This is likely due to many varied factors that include the need to use assets to protect themselves while they are alive, uncertainty about the financial maturity of their children, and the need some boomers are facing to pay for their own parents’ medical expenses. The weak economy may also be contributing to the changes in estate planning being contemplated by many in Texas.
Even billionaires like Bill Gates and Warren Buffett have announced that they believe that inheritances should help even the playing field for beneficiaries. Stating that they feared that the new generation lacked the work ethic and capacity to handle large wealth, some extremely wealthy boomers are choosing trusts for charities and other forms of giving.
When planning for an estate, people in Texas may find it valuable to make a list of all assets and who they would go at the time of death. In addition, having a discussion with potential heirs that details plans for asset distribution may lessen the blow to some who thought that they were inheriting large sums but might not be. These steps can make estate planning painless for those who are working to maximize the benefit of their money while alive and after death.
Source: CNBC, “Boomers’ Tough Love: Inheritance Skips Generation,” Madeline Laskoski, June 18, 2012