Your Estate Plan Holds The Key To Resolving Money Conflicts With Your Adult Children
By now, you are probably familiar with some of the truisms of estate planning. Let the 4 percent rule guide you in saving for retirement. Inheriting from a trust is better than inheriting through probate. Live it up instead of letting your descendants squander your money after you die. Give your kids their inheritance while you are alive. Once you get into details, though, you realize that there is no universal solution about how much money to give your children or how to do it in a conflict-proof way. Parents and children might have different values about money. Parents might give money or withhold it as a way of controlling their grown children. Adult sons and daughters might play on parents’ guilt or fear of estrangement if the parents refuse to meet their children’s demands for financial support. Choosing how much money you are able to give your children on an as-needed basis, and how much you are willing to give, is an integral part of your estate plan. Contact a Central Florida estate planning lawyer to discuss how much to spend, how much to save, and how much to act as the Bank of Mom and Dad.
Saying “Yes” Purposefully
You should plan for how much money you can give your kids long before they ask. Keep in mind that “can give” means not only that you have the money, but also that you weren’t planning on using it for anything else and would be willing to part with it. You would be helping no one if you emptied your bank account so your son could start a business; if the business succeeded, you would have to depend on your son, and if it didn’t, both of you would be stuck depending on another family member. If the amount you plan to give in a certain year, assuming that you child needs that much money, exceeds the annual gift tax exclusion (currently $15,000), meet with your lawyer to discuss getting the money to your child in a way that legally reduces the tax burden on both of you.
Saying “No” Compassionately
Parent-child conversations about money can leave everyone feeling terrible. Even if no one uses the terms entitlement, helicopter parent, failure to launch, or favoritism, any of the parties involved in the conversation might still be thinking them. Having a budget, and a script related to your budget, can prevent these problems. If your daughter asks for $20,000, simply tell her why your budget doesn’t allow it. You can offer her 15 grand because of the annual gift tax exclusion. By sticking to budget talk, you send the message that she is in no position to judge you for going on a cruise with her stepmother, just like you are in no position to judge her for bailing out her boyfriend’s vegan bakery. Focus on money, not on emotions.
Contact an Attorney for Help Today
Your Clearwater estate planning lawyer can help you make an estate plan that leaves room for your children’s unexpected financial needs. Contact William Rambaum for help today.