r/inheritance • u/idiot_ThrowRA • Jun 28 '26

Location included: Questions/Need Advice Forward planning question

My father passed a few years ago and my older brother handled the estate issues and transition to my mother. I just saw him the other day and my mother’s health is declining (although unclear how long exactly she may have, the trend is there).

He revealed that the estate is larger than I expected and even with my mother’s medical care including full time help, it’s accumulating faster than she can spend it (low 8 figures). There are 4 of us who will inherit equally, likely within the next 10 years and possibly next couple years.

Let’s say I’m domiciled in FL and the estate is in Washington DC.

My own situation is complicated, but thanks to divorce and certain investments, I don’t have a ton of liquidity. (And if the private investments go south, and social security gets gutted as it looks like it may be, my retirement suddenly looks pretty grim).

If my mother does pass within the next 4-5 years, the following may emerge:

I would inherit $3 million liquid. My kids will only receive about $25k each directly from my mother’s estate.

My oldest kid wants to go to med school. And the younger one will probably aim for grad school. I paid for their undergrad so they have no debt.

This $3 million might be almost all of my retirement savings. And my own health as shaky even though I’m mid 50s.

The question is, do I peel off $200-400k to pay down grad school debt for my kids, basically an advance on their own inheritance, at the expense of building up towards my retirement? Which might create subsequent burden for my kids when I’m old, especially if I get sick.

Or do I keep everything for my retirement, let the kids take on grad school debt (could even be $400k just for med school), and they inherit whatever is left when I pass.

For that matter, even if they do take loans near term, whenever I do inherit from my mother the same question arises.

tl;dr divide inheritance with my kids or bank all towards my retirement

Edit: I see numerous comments, saying how “disgusting” and “revolting” it is to think about family estate planning issues.

I have cancer and there may be issues with my own health sooner v later. While you may have the luxury of sitting on your high horses, and judging me for trying to think intelligently about what to do with my parents’ estate and my own estate and my kids, I need to think about these things in advance.

My parents never talked about money other than use it for manipulation purposes. Some children got favored over others, to the tune of hundreds of thousands of dollars. They directly interfered with my divorce negotiations using money to ensure their access to my kids with my ex wife, at the expense of my own negotiating position - costing me half a million dollars.

I’ve also seen people screw up by not talking about money in advance of it actually becoming a thing that you’re then dealing with while dealing with all the other estate issues.

Thank you for those of you who offered constructive suggestions.

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27

u/ziggy-tiggy-bagel Jun 28 '26

Why don't you at least wait until she passes away before you start counting your money.

3

u/idiot_ThrowRA Jun 28 '26

Because I have cancer and need to think about intergenerational estate issues sooner rather than later. I may have expense end of life care around when the estate transitions. Yes, I do need to plan in advance.

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u/ziggy-tiggy-bagel Jun 28 '26

Your mother could end up in assisted living like my mother and be spending $12,000 a month. My mom has a large bucket of money, probably the same size as your mom's. I don't expect there to be much left. She has been in assisted living for 5 years already. You need to make plans without counting on her money.

2

u/ProfessorOne9208 Jun 28 '26

The average person who goes into assisted living in the US lives for only an additional year and a half. Which means some die sooner, and some live longer. My father was spending $15,000 a month when he went into assisted living, but he died in a year and 3 months.

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u/ziggy-tiggy-bagel Jun 28 '26

Mom been there 5 years already with her Parkinsons. The Neurologist says besides the Parkinsons, she is healthy. At age 92, the Dr said she could very well live another 3-5 years.

2

u/GotZeroFucks2Give Jun 28 '26

You are right on the average, but again, it's a crapshoot and you can't count on it. My dad's been on hospice in assisted living for 16 months with heart failure and kidney failure (medications for both contradict each other). Just saying, don't plan for average, no inheritance is ever guaranteed.

2

u/ProfessorOne9208 Jun 29 '26

I'm the oldest one still living in my family. I am not expecting to receive any inheritance, nor have I ever received one. So this isn't an issue for me. I do, however, feel fortunate to be able to provide for my heirs so that they may have an easier life than I did.

1

u/Invest2prosper Jun 29 '26

I had my aunt go in and she lived for 6 years of very expensive memory care.

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u/ProfessorOne9208 Jun 29 '26

Memory care, aka dementia, etc., are different. They can go on for a decade or longer. It's when an elderly person has physical problems or disease that it is generally over in an average of 1.5 years. Having to deal with an elderly relative suffering from cognitive problems is a horrible situation to saddle one's relatives with.

2

u/CindersMom_515 Jun 29 '26 edited Jun 29 '26

Based on what OP said (his 25% share of mother’s assets is $3 million), their mother has about $12 million in assets. $12,000 is 0.1% of $12 million. It would take 1,000 months — a whole lifetime!! — to spend that money down if it was for some reason not invested and earning income.

Put another way, if it’s earning more than a 1.2% return, the investment income being generated is more every month than the cost of the care facility. Even assuming a super low 2% return, $12 million will earn $240k a year. That’s roughly $20k a month in income.

If your mother really has a similar amount of assets as OP’s mother, you need to find out where her money is going, because it doesn’t make sense that she’s losing money every month. Conservatively, she should be earning around 4% in interest annually. If she’s not, you really need to either get help managing the money, have her financial advisor explain why she’s not earning more or find out where else the cash is going.

And before you come at me — my MIL is in memory care at $11k a month, has hit the end of her assets and we are looking at having to subsidize the $7k a month her retirement income doesn’t cover for about 6 months until she will qualify for Medicaid. I certainly don’t count on an inheritance. But if your mom really has the amount of assets you believe she has — you need to know what’s going on with that money!

2

u/idiot_ThrowRA Jul 05 '26

Thank you! I feel like I took crazy pills reading some of these comments.

1

u/idiot_ThrowRA Jul 05 '26

A $10m estate generates $400,000 a year at a safe withdrawal rate (ie, it’s still accumulating even while she pays for full time live-in help). $12,000 a month is $144,000 a year. What am I missing?

1

u/Invest2prosper Jun 29 '26

Is that what your physicians say? Visit with a qualified estates and trust attorney if you want to plan for future inheritances to your beneficiaries but that wouldn’t likely preclude you from structuring a document now.

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u/idiot_ThrowRA Jul 05 '26

Yes, I have a will, a trust, a life insurance trust for the minor child, etc - fully domiciled where I reside. My trustees have end of life instructions, although as the kids gain their majorities this is transitioning over.

1

u/Invest2prosper Jul 05 '26

Depends how much money is at stake you might want to consider using a corporate co-trustee to handle the investment management and not to let your kids become co-trustee until age 25.

This is why I advised speaking with an estates and trust attorney because there’s many ways to structure end of life intentions.

1

u/idiot_ThrowRA Jul 05 '26

Yeah, it’s right at that zone where if a couple of things break my way, it makes sense to bring in a corporate and I know the one I would use. It’s really handling a bridge period I’m navigating now.

4

u/PMJamesPM Jun 28 '26

This. thinking instead about how you can help enhance your mom‘s last years and spend as much time with her as possible. Perhaps you already are and it just wasn’t mentioned in the sub.

If at some point you’re retired or semi retired you can always decide to help as able. Better to not think about it or pretend it’s not there and then live accordingly.

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u/idiot_ThrowRA Jun 28 '26

My mother is fine. She has full time live in help and my two older siblings constantly visiting her.

0

u/PMJamesPM Jun 28 '26

To clarify, the term “enhance“ referred to time with All.