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New report shows many people not leaving an inheritance

Many people living in the Lakeland and Winter Haven area are members of the Baby Boomer generation. This group of people, which includes those who are currently between the ages of 51 and 69, numbers nearly 75 million, according to data from the U.S. Census Bureau. That makes the Baby Boomers the second largest generation of people in the U.S., with only the Millennials outnumbering them.

For decades, the Baby Boomers have had a profound impact in shaping the country's direction with regard to just about all areas of life. Now, it appears that they are starting a new trend, not leaving their children an inheritance. A new report by the multinational banking and financial services company, HSBC, shows that 23 percent of retirees plan to spend all of their money rather than leaving an inheritance to their children.

In a recent interview, radio host and businessman Dave Ramsey discussed why some Baby Boomers, in particular, are not saving as much and planning to leave assets to their children. Ramsey explained that many Baby Boomers suffered financial setbacks due to the 2008 financial crisis, and felt like that had to start over. This not only meant that their savings may have been partially wiped out, but it also could have instilled a feeling of hopelessness regarding savings and retirement. Hence, Baby Boomers in this situation would be less likely to pass money or other assets down to their children.

Another reason that Baby Boomers, and anyone else who has assets, may choose not to leave their children with an inheritance is out of concern that the children might not use it constructively. No parent wants to think about their child frittering away the money that they have worked their whole life to save. Likewise, parents with substantial savings may not want to financially enable their children to the point where the children are unproductive with their own lives.

If a parent does want to leave their children an inheritance, but has some of these concerns, they can use trusts and other legal instruments to structure their estate plan to avoid some of these potential problems. Like any decision involving money, the choice of whether to leave children an inheritance is a difficult one for some people. An experienced estates and trusts attorney can help these people to at least understand the legal options that are available for constructing a sound estate and inheritance plan.

Source: FOX Business, "Should You Leave Your Kids an Inheritance?" Julia Limitone, Oct. 12, 2016

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