A Message Regarding Beneficiaries

If your parents or other loved ones have named you as a beneficiary of their estate, whether it will be distributed under a will or a Trust, congratulations -- please take the following under serious consideration:

All of their stuff in their home, garage, closets, trunks of their cars, storage units, under their bed, is exactly that -- their stuff.

All of their money in banks, credit unions, mutual funds, stocks, bonds, pensions, retirement plans, businesses they have started, purchased or invested in, under the mattress, in their pocket, is exactly that -- their money.

By naming you as a beneficiary, they have decided that on the day of their death, their stuff and their money will make the magical transition into "your inheritance."

The most distasteful sentence I have heard recently, from a client repeating what his daughter said, and I am not making this up, is,
"Dad, can I get an advance on my inheritance?"
Until Dad dies, there is no such thing as "your inheritance." It is his stuff and his money. What you just said was,
"Dad, you are living too long, it's inconvenient for me -- can we pretend financially that you have done the right thing by me and died? Oh, and obviously I won't have to pay interest or pay it back because it isn't a loan, it's an advance and some day you'll die and, you know, paying it back just doesn't make sense."

If you need a loan, go to someone whose business is making loans. Pay interest. Grow up.

Within a week prior to this writing, and I am not making this up, I have received two calls from beneficiaries who said --
"My Dad gave money to my sister and that's not going to be fair when he dies. Yes, sometimes he gives me money too, but I think he has given her a lot more. How can I stop her from taking my inheritance?"

So here are the messages:

Parents/Trustors
Make sure that your beneficiaries are worthy of the honor and respect you are showing them through trusting them to do right with the financial fruits of your whole life. Don't use money as a way to show love or a lack of it. Money isn't about love, despite what the world has told us. Money is about responsibility. Love is an emotion. If your child "desperately needs" "their inheritance" there is a good chance you shouldn't give it to them because they will simply do with the residue of your life what they have done with their own life -- fail. It's no different than giving cash to a drug addict "for food." You may be contributing to their destruction.

If you want to test it, try this -- Give each of your beneficiaries an equal amount of cash, maximum $11,000 per year to avoid the gift tax. Don't tell them it's a test. Wait 90 days and then casually ask each of them, "So, what were you able to accomplish with the money I gave you?" The answers you receive will tell you whether you have chosen worthy beneficiaries.

If you have already given "advances," make sure that you have taken steps to assure that the "advance" is deducted from the beneficiaries share of the estate at your death.

Please remember that money is a tool. It can build or it can destroy, depending upon who is using it. There are innumerable truly worthy organizations that could do wondrous things with your money. Please choose to be as responsible with your finances in death as you have been in life.

Children/Beneficiaries
Don't even think about it. Don't keep accounts in your head. Let it go until they are gone. Certainly advise them to get their affairs in order to asssure that their wishes are known and will be carried out as they desire. But it's not about you. Encourage them to enjoy the fruits of their lifetime of labor. Get them a bumper sticker that reads, "I Am Spending My Kid's Inheritance" and tell them to do it. If you "need" their money, you have failed. I know, it's not your fault. It's not the result of your choices. Regardless, get over it, pick yourself up and find a way to succeed. If you have taken "an advance against" your inheritance, pay it back, with interest, and apologize to your loved one for being so shallow and selfish.

In life, each of us is either a source for others or others are a source for us. Children and other immature persons always need a source, for food, housing, medical care, etc.. Maturity is making the transition from needing a source to becoming a source. Do an analysis of your life -- how many people look to you for guidance, assistance, wisdom? How many people do you contact asking for help? Is it time to mature?

Call me if you want to talk about it - 800 400 4262.

Want to read a book on the issue? Or an article? Or some actual family stories?

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