Tuesday, June 28, 2016
Being submerged in one of the greatest wealth transfers in history, can force an estate planner to not only pay attention to financial strategies for a high-income individual’s estate but also the psychological and emotional impacts of such asset transfer. Wealthy individuals normally have more challenges creating a legacy due to the amount of assets and the various vehicles they use to pass their assets to the next generation.
Consequently, clients should have a comprehensive estate plan in order to accomplish their specific goals. Further, it is essential to understand the psychological and interpersonal issues that surround large inheritances due to their risky consequences. Allowing inexperienced heirs to become wealthy upon inheritance can surmount to unforeseen problems, which should be carefully planned for. First, the client must consider the specific concerns and risks for each wealthy individual and their family members. Second, the client should take into account the various alternatives to passing a legacy, including a debt-relief gift, contributions to educational funds, and special needs trusts. These steps will help take into account the reality of the family’s situation and what options are best for passing on their estate.
See Robert G. Kuchner, When Is an Inheritance Too Big?, Private Wealth Magazine, June 27, 2016.
Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this Article to my attention.