Counting on an inheritance is a risky business.
In a recent Money.ca article, the personal finance outlet spoke with a 70-year-old Nova Scotian who had based her retirement plans around the quarter share of her mother’s $500,000 estate she expected to split with her siblings after caring for her elderly parent for years.
However, things haven’t panned out as she was expecting, after the mother moved out and started giving her money away – apparently in a preemptive bid to avoid an estate fight over the assets between her children once she’s gone.
Surveys cited in the report suggest that the story’s East Coast subject is not the only one who could be in for a rude awakening when their parent dies. For example, one found that around 80% of Canadians expect a financial windfall whenever their parents pass on.
The problem is that proportion may not be matched by the percentage of parents who want to leave a big inheritance to their heirs. And even if they do, there’s a decent chance that they may need to use some or all of that money to fund their own care, depending on how long they live.
In my line of business, you don’t have to wait too long for a fresh reminder of the emotional impact of decisions around money.
It doesn’t take huge sums of cash to spark a legal fight over an estate. In fact, the size of the rift is more to do with clashing expectations, emotions and perceived unfairness than the hard figures. When families are ripped apart over money arguments, it’s almost always because one person got less than they had hoped or someone else got more than they were supposed to.
Luckily, there is a solution for testators who wish to avoid an ugly family feud after they’re gone: open and honest communications with your intended beneficiaries.
By giving your loved ones an idea of what they can expect from a will, you can nip a lot of issues in the bud before they develop into something more damaging. Even if someone is getting less than they had hoped, setting realistic expectations ahead of time will take a lot of the heat out of the situation when estate administration begins.
Disclaimer: The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting members of Laredo Law (or their own legal counsel) regarding any specific legal issues.
