This column originally ran in 2019 but is as relevant today as it was then. It is a reoccurring theme in most families. Hope you enjoy it!
Research published in a Natixis U.S. Investor Study shows that 70 percent of young people expect to receive inheritance from their parents. By contrast, only 40 percent of parents plan to leave anything to their children. Many from this younger generation feel entitled to an inheritance – almost as though they earned it themselves. Did they?
When I was a teen, a close friend’s family owned a restaurant known for its excellent French cuisine. The restaurant served dinner, which meant her parents worked late into the nights leaving my friend, Debbie, and brother, John, on their own to complete homework, eat dinner and get to bed at a reasonable time. (Of course, being opportunistic teens, there were many-a-party at their “parentless” house – but that is not relevant here and, for the most part, I think we got away with it!) In a sense, it would seem that Debbie and John helped build the family wealth by essentially raising themselves and not being too much of an inconvenience to their parents during the late hours they spent away from the home establishing the successful eatery.
Disinheriting children is extreme, and, in many countries, it is simply illegal. Sharia law in Muslim countries and the Napoleonic Code throughout Europe and parts of Latin America tightly prescribe how and what you must leave to heirs. America and other Anglo-Saxon countries are the exception; we can generally leave our estates to whomever we choose.
A New York Times article by Paul Sullivan tells the story of “Kate,” whose father died when she was in college. Kate stayed close to her grandmother, aunts and cousins. When grandma died, Kate was surprised to learn that grandma’s estate was left only to her aunts, completely cutting out Kate and her siblings. “This didn’t seem right,” Kate said. “This is our birthright. We didn’t have our father to defend us.” In Kate’s case, it turned out that a week before grandma died, she executed a deathbed will disinheriting Kate and her sibs. The reason the aunts gave Kate for this late change in grandmother’s will was that the aunts were with grandma in the end, day-in and day-out, caring for her when she needed it most while Kate and her siblings were not around.
After 18 months of litigation, Kate received a small settlement. Unfortunately, the litigation cost her the previously good relationship she had with her aunts and cousins.
The moral of the story, if there is one, could be that our children may have the expectation of receiving whatever is left of our estates when we die. If we decide to instead leave our estate to charities or to others, it is best to communicate this to our children and, unless it is blatantly obvious, why this decision was made. Kate said that she wished her grandmother had left her a letter explaining the change, she believes it would have given her more peace.
Question. I appreciated your column on preneed planning but there was a glaring omission – donation of body parts!
You are absolutely correct and thank you for pointing this out! Yes, when making end of life plans, remember that your body parts may be helpful or useful to others. Look into body or body part donation and make sure it is known to those who will be helping you in the end so proper measures can be taken to preserve your body and deliver parts, as you direct.
Liza Horvath has more than 30 years of experience in the estate planning and trust fields and is a licensed professional fiduciary. Liza currently serves as president of Monterey Trust Management. This is not intended to be legal or tax advice. If you have a question, call (831) 646-5262 or email liza@montereytrust.com
