Questions To Ask Before Leaving An Inheritance
It may sound like a good thing to do. It may sound like your only option. What is it? Leaving some kind of inheritance to friends and family after you die. But it can be a complicated thing in the end due to issues such as inheritance tax and gifting making people unsure about exactly how much they can leave someone before it becomes too much. And although you may want any money or possessions left over to help your loved ones, could you actually be doing more harm than good?
There are certain questions that should be asked before deciding on what to leave to whom. Once these are answered, you’ll have a much better idea of exactly what you should do for the best.
The first question is to ask how much you can leave as an inheritance before it becomes a burden. To know the answer to this, you should work out the tax implications of each bequest, and if this is not possible then speak to a financial advisor or accountant about it. They will be able to tell you the best way to leave your estate to your loved ones.
Next, just what is your financial position? Without knowing this it can be very difficult to work out how much you can leave someone anyway. What about your retirement? You may have financial wealth when you write the will, but what about if you live long into retirement? Will your estate be affected? Will you need to write a new will to take that into account?
And what about the beneficiaries? Although it’s nice to leave something to everyone, are there some that need the money more than others? And are they healthy? How old are they? It all can make a difference, even if it isn’t the nicest thing to think about. If the heir is a minor, you’ll need to think about setting up a trust for them, or you may need to mention specific provisions to be put in place for a disabled beneficiary. But what if the inheritance will have an impact of any benefits they receive from the government? This will all need to be taken into account. And if your potential beneficiaries have been made bankrupt in the past? Their creditors might take the majority of the inheritance as payment, and it could have been a better idea to leave it to someone else.