About 70% of baby boomers see a gift of money as an expression of love, according to the results of a recent survey. This may sound like a very thoughtful act, but it can really complicate estate planning—particularly when the generation receiving the inheritance doesn't feel the same way.
Reuter's recent article, "Equating inheritance with love can cause discord," explains that Millennials hold very different views about receiving gifts. According to the survey, roughly 33% of them feel that a monetary gift is a way for the older generation to exert influence over them.
The fact is that when generations have different opinions about the motivations of an inheritance, they also fight over how assets should be distributed. While most of those over 50 think it's fair to divide estates equally among heirs, only a third of millennials felt the same way. The younger generation is more open to weighing financial needs and other factors to determine a recipient's worthiness.
Getting family members to talk to one another about estate planning can be tough. But try to get everyone involved early, so that the giver can help avoid any disappointments or misunderstandings. Don't leave any surprises for loved ones to sort out after you have passed. Make certain that they are aware of the emotional legacy rather than the financial details.
Strong family communication can make an unequal shares distribution easier to handle. Sometimes a trade-off is helpful—as the giver can pass along something meaningful to each heir—when the gifts don't have the same financial value.
With the help of an experienced estate planning attorney, even people with very little are able to give in an extremely meaningful way.
Reference: Reuters (April 15, 2016) "Equating inheritance with love can cause discord