As we enter this holiday season and get into the spirit of things, many of us are reminiscing on childhood traditions and superstitions.
Hopefully, none of us were raised in egregiously draconian households. However, many of us surely strove to stay off of Santa’s “naughty” list for fear of receiving a lump of coals in lieu of the latest Barbie doll or Legos set.
However, as we get older, there’s a “naughty” list we should fear even more: our own family’s.
Inheritance: Are You Naughty or Nice?
According to the Los Angeles Times, Americans collectively inherited $427 billion in 2016 alone. The median individual inherits roughly $55,000.
Not every family is privileged enough to leave inheritances. However, for those that are fortunate enough, children should not automatically assume that they will receive an inheritance.
Here are some common reasons that a child could be excluded from an inheritance:
The child has been abandoned.
The child is estranged from the parent.
The child struggles with addiction.
The child is believed to have already received enough financial support.
A sibling experiences a greater need for financial support.
There are also accidental reasons why you wouldn’t receive an inheritance:
Your parents forgot to update their Will and/or Trust after you were born.
Once estranged, your parents forgot to update their Will after you patched up your relationship.
You are in a blended family and because you weren’t expressly mentioned in the estate plan, state laws distributed assets to other members of the family.
With all joking aside, no one wants to be disinherited from a family estate, regardless of if it is intentional or accidental. This is why it is best to never assume that you will receive an inheritance from your family. It is critical to have open and honest conversations with your family about estate planning so that you can be certain.
How to Talk to your Family about your Inheritance (In A Tactful Manner)
The holidays are a season of family gatherings, and they provide the perfect setting for bringing up the subject of your inheritance.
Yes — you read that correctly. The holidays are a perfect time for talking to your family about your inheritance, as long as you go about it the right way.
The suggestion of bringing up your family’s estate, let alone your potential inheritance, might go against every fiber of your being. Most American families were conditioned to not talk about money at any cost, but it’s actually the lack of these conversations and transparency surrounding money that end up costing us.
Of course, you may not want to approach the subject during a large family dinner. However, it may feel appropriate to pull a parent aside for a meaningful conversation during some down time. Approach the subject with care, patience, and compassion, as this is likely an awkward conversation for both parties involved.
Try opening the conversation with the idea that you’ve been educating yourself about estate planning and have been thinking about creating your own plan. Then, this can lead to a question of whether or not your parent(s) have an estate plan, and if there is anything they would like for you to know.
When you eventually approach the subject of your inheritance, it is best not to ask for specific numbers. This could potentially rub your loved one the wrong way. In addition, the exact number may change over time. It is best to allow your parent(s) the space to reveal exact numbers when they feel comfortable. However, you can emphasize that having the knowledge of whether or not you will receive an inheritance will help you plan for your own future.
Further, you can mention that you became concerned regarding examples of individuals becoming disinherited from an estate by accident. This important conversation could serve as a timely reminder for your parent(s) to review and update their estate plan as necessary. This should be done at regular intervals throughout their lifetime.
Once you’ve had this talk with one or more parents, it’ll be much easier to expand the conversation to include other family members who are involved in the estate plan.
If anything, this “inheritance talk” could help shine a light on any weak spots in your parents’ estate plan, or it could turn out that they don’t have an estate plan at all! This could be your moment to protect your family and ensure that they have an estate plan in place.
For more tips about how to have estate planning conversations with your family over the holidays, check out our guide here.
Acknowledging Strained and Absent Relationships this Holiday Season
We would like to recognize that the holidays aren’t necessarily heart-warming for everyone. Because there is so much focus surrounding family and family traditions, the holidays can also bring about feelings of grief, abandonment, and loneliness for some. If you are currently in a position where you feel unable to speak with a family member regarding an inheritance, or it is not an option, know that you are not alone.
You are empowered to start your own legacy, which you can in turn pass on to loved ones one day. Your legacy does not necessarily need to be passed on to a child or a spouse either; you may even establish a generous gift or donation to a cause that you care about. Know that no matter how humble your beginnings may be, a proper estate plan can help you grow and protect your wealth over time so that you can bestow a lasting memory. To establish an estate plan, you can get started here.
If you do have a parent available but you struggle with a strained relationship, addiction, or any other aspects that could impact your candidacy for an inheritance, there may be some solutions. For starters, you may consider repairing relationships in a genuine and authentic manner. In the case that someone were to struggle with addiction, for example, families simply may not be aware that there are mechanisms for providing financial support in a way that is empowering and will not put you at risk. Click here to learn more about different types of trusts that can be set up to address a myriad of unique circumstances and family dynamics.
Make Sure You End Up on the Nice List this Holiday Season
Every family dynamic is different, and bringing up the subject of inheritances can be awkward and even difficult for some. However, something as important as estate planning should not be swept under the rug. Gathering the courage to bring up this sensitive topic could be the difference between receiving or not receiving an inheritance one day. It could be a matter of patching up strained relationships, or making sure that your parents have an updated estate plan in place.
If you or your family members would like any support in establishing or updating estate plans this holiday season, Trust & Will has your back! We offer estate planning products that are affordable, accessible, and easy to use. Even your most reluctant aunt will soon realize that estate planning can be a breeze, given the right tools. Ready to get started? See what Trust & Will has to offer today!
Is there a question here we didn’t answer? Reach out to us today or Chat with a live member support representative!