No one wants to talk about death. But I’ve been thinking about it since I heard Boston estate planning attorney Patricia Annino say at a Women’s Philanthropy Institute webinar that many boomer women can look forward to two or more inheritances.
One may come from their husbands, who'll likely predecease them; women live roughly four years longer than men, on average. Another bequest could be the gift of parents or in-laws. Money or assets might even be passed along by siblings; my 50-something sister is named in my will and, since I don’t have children, will get my horse even if my husband is still alive.
Are you prepared for the possibility of multiple inheritances?
(MORE: The Cost of Bestowing an Inheritance)
Overall, 2 out of 3 boomer households will get at least one inheritance in their lifetimes, receiving a median of $64,000, according to estimates by the Center for Retirement Research at Boston College. The wealthiest 10 percent are expected to get an average of nearly $1.5 million.
What Could Reduce Inheritances
Those numbers may be a little pie-in-the-sky, of course.
Most boomers haven’t received any inheritances yet. And as a recent Wall Street Journal article noted, since the postwar generation is living longer and many took a big financial hit in 2008: “Many baby boomers are likely to get less money from mom and dad than they thought. The worse news: They may have to help their parents financially instead.”
If you will be receiving one or more inheritances and plan properly, though, the windfall can change your life. I speak from experience. My husband and I received two parental inheritances in the past four years. But I’d be lying if I said that navigating those transactions was a breeze or that we didn’t make a few mistakes along the way.
Having the Delicate Talk
To avoid being flummoxed by a potential inheritance, try to talk with your parents about their estate plans. This conversation can be delicate, but if your parents are OK with discussing the subject, do it. They might even want start to the ball rolling by passing down some belongings before they die.
Our family helped my father gradually distribute many of his possessions during his battle with Alzheimer’s. Each of the kids selected items that my mom didn’t want to keep, like clocks and artwork.
By law, your parents can give away up to $13,000 a year to as many individuals as they’d like like without incurring the federal gift tax. The $13,000 figure includes the value of cash, stocks, jewelry, artwork, antiques and more.
Don’t miss out on MORE great articles like this one. Click here to sign up for our weekly newsletter!
Photo courtesy of NotarYES/Shutterstock.com