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inherited money

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  • inherited money

    I hope the third try is the charm.  I keep trying to post this new thread.....A friend recently confided something to me that I had actually long suspected.  His retirement plan is primarily that his wife is going to inherit big money from her Dad.  Oops!  Her Daddy  now has a new girlfriend and is moving to the beach and traveling.  Her brother is inheriting what ever is left.  I don't know if he would have gone to Tahiti a few months back if this development had occurred prior.  He has for years never had the money for his retirement plan due to Mercedes (his and hers) which were leased, elaborate vacations, and a large home.  His house will not be paid for until he is in his early 70s.  He may not be able to retire then.  Bottom line.  Inheritance is not the sure thing that having your own investments and planning for your own retirement is.

  • #2
    Relying upon an inheritance is certainly not a financial plan. I have seen this all too often. People don't plan to fail, they just fail to plan.

    Lawrence B. Keller, CFP, CLU, ChFC, RHU, LUTCF


    • #3
      Unclear of the value of your post.


      • #4
        Inheritance is never a sure thing. Planning a future based upon a spouse's inheritance is even worse.
        Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087


        • #5
          I thought it was a good discussion topic  Certainly not my idea of a plan


          • #6
            Another vote for LBYM (live below your means), regardless of circumstances, or in this case, expectations.

            Thanks for sharing.  Sounds like your friend is learning a lesson the hard way, and we can all learn from his story the easy way with a 30-second read.


            • #7
              Good reality check.  I won't lie and say that I haven't been looking ahead to when my dual-physician in-laws still working at 80+ year old pass.


              • #8
                I have inherited a modest amount of money, from a grandparent and an aunt, a total of $300k, coming about two years into my post-residency career and then at about twelve years post-residency. It was not life changing but certainly better than a sharp stick in the eye! This helped me pay off my house sooner and added some seed money to 529 plans and other savings/investing goals. No trip to Tahiti.

                There will likely be some more down the road but best not to count on it. If/when it comes, it buys financial independence and freedom at an earlier date or of greater magnitude. Maybe a trip to Tahiti.

                I did work in a job years ago with a senior partner that whose spouse had extreme real estate wealth. He told me that his father-in-law told him early in his career not to be bother saving for retirement--what his wife will eventually inherit would dwarf anything that he could manage to put together--and he obeyed. I did not keep in touch with him long after that and do not know what the outcome was, but imagine if his marriage was failing and he was forced to stay with his wife because he was financially dependent. Or maybe the FIL made some but decisions and lost it all.


                • #9
                  I also inherited about 300k. I was 52 and financially secure.  I always knew about the money since I managed my Dads money for years before he died.  I knew it would not be a life changing amount.  My point in the post is that inherited money is not a sure thing and in most cases it is best not to count on it.  I always assumed that it was likely that he would use up his nest egg in a nursing home but that did not happen.


                  • #10
                    I have heard of docs with this as a possible retirement plan instead of considering dropping the $70 per week of lattes and leased luxury cars.  I think it is important to eliminate this as a possibility in your mind altogether and emphasize to your potential benefactors that you are not relying upon them for your security. Major advantage: they do not try to coerce you into things through guilt or dependence.  Minor advantage: being able to honestly tell them they can do whatever you want with their nest egg is empowering to both parties.  I bet many parent/relatives would feel better about giving to worthy cause rather than contributing to already wealthy children's lifestyle(s).

                    Imagine how you would feel if your kid, who you have paid for their college etc, decides to buy a large estate on a golf course (beyond their means, insert your own example), believing that they will mend that mistake with a healthy donation from pops after he finally kicks the bucket.  That might be the time that you consider marrying someone 20 years younger and living those latter years in wasteful glory!