If you think about your estate plan as a way for you to pass on gifts to your loved ones, have you considered whether or not they may be eligible or responsible enough to take on these significant assets? A recent study finds that the majority of Americans who may receive an inheritance in the coming years don’t have the ability to handle it.
New York Life’s Wealth Watch Survey found that only 42% of adults who are anticipating some kind of inheritance from a family member said they felt comfortable handling the new financial opportunities that will be passed down to them.
The study also identified that this breaks down even further by gender, with women being twice as uncertain about their ability to effectively manage an inheritance.
Using a trust is one way to provide more control and comfort for someone getting an inheritance. The funds or assets may be released when certain milestones are hit, such as graduating from college or reaching a certain age. Likewise, you can choose that assets are distributed over time to decrease the chances of making a big financial mistake.
Talking with your loved ones about these options or perhaps even placing the assets inside a trust can help to reduce some confusion and increase the chances that your loved ones will feel comfortable and understand the options available to them when it comes to an inheritance.
Open conversations and discussions about your legacy can help to bring up all of the options you may undertake. Because there are so many complex factors involved in the estate planning process and all of them must be associated with your personal needs and plans, talk to an attorney now.