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How inheritances are presenting problems for some baby boomers

Gregory A. Lang

It seems as if much has been written lately about the 79 million baby boomers here in the U.S. and their goals regarding estate planning. Typically, these pieces focus on how boomers' strategies for distributing their often substantial assets differ from generations past in that they might include more charitable donations or donations to causes they felt very strongly about during their lifetime.

While this is certainly interesting, there is another aspect of estate planning concerning boomers that perhaps merits further attention: their own inheritance.

Even though people are now starting to associate boomers more and more with the senior demographic, it's important to understand that the parents of many of these boomers are currently alive and well, meaning they may find themselves with an inheritance in the near future.

Furthermore, experts have indicated that these inheritances could stand to be fairly substantial for some, as many parents of boomers were raised during the Great Depression and therefore were very protective of their money. Indeed, the Center for Retirement Research at Boston College has estimated that by 2030 boomers will inherit upwards of $8.4 trillion.

While you would think that the prospect of inheriting substantial assets would be exciting for boomers -- perhaps funding a new business venture or a new career -- experts have also found that isn't always the case.

That's because the sudden influx of wealth from their fiscally responsible Depression-era parents may come with a host of emotions -- relief, regret, guilt, loss, etc. -- that can make it difficult to properly manage.

"Inherited money is sacred money," said one 61-year-old man who recently inherited money and property from his mother. "Whatever you do with that money, you should think about your parents and what they would think of what you did."

According to experts, some boomers actually think about it too much, holding onto assets out of a sense of duty, guilt and/or pure sentimentality, rather than investing or managing it wisely.

In light of these realities, experts are advising boomers who inherit assets from their parents to consider taking steps to honor their memory (funding a scholarship, making a philanthropic donation in their name, etc.) rather than just blindly holding onto assets.

In addition, they advise boomers to consider discussing the matter over with their parents before they pass, such that they can learn specifics ahead of time and share their concerns.

Are you a boomer who experienced this phenomenon after an inheritance? If so, how did you manage it? Do you have any regrets?

To learn more about comprehensive estate planning, probate administration or insurance, consider contacting an experienced attorney who can answer your questions and help outline your options.

Source: The New York Times, "When boomers inherit, complications may follow," Fran Hawthorne, Feb. 10, 2014

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