I'm rich! Great article on talking to children about inheritance that emphasizes the importance of estate planning early. As the NYTimes is wont to do, the perspective is geared toward the super-rich, but I think this is applicable to everyone. Even if you are only expecting to leave your children tens of thousands, it's the same issue: Are they ready to receive a big inflow of cash?
The money quote (pun intended):
What heirs should know and when is the question every parent wants answered, Mr. Williams said. The biblical story about the prodigal son was really about a son who wasn't prepared, he said. It's the same problem today.
The better question parents should ask themselves, he said, is what they want to accomplish with the money.
Estate planning allows you to choose when your children will receive their inheritance, and who will manage the property and assets you leave until that time. Without an estate plan, a court will appoint a property guardian until your child is 18, at which point she or he will have full control (for better or worse!).
As the article notes, just as important as when money and property are transferred, is talking to your children about your values and what it means to have money. The best way to prepare your children is to have conversations about financial stewardship, saving for the future, and generosity.
After all, your greatest gift to your children is not your wealth, but your wisdom (and if possible, why not both?).
(Photo: She Knows)