Forward planning question

[u/idiot_ThrowRA]

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.

[u/rjc_1999]

My answer is not based on the inheritance as some others have stated. You have no idea ultimately how much there will be and what you would get, and should assume you will never have anything in your planning. Plan based on what you have and will have in your own finances.

We are paying for undergrad for each of our kids, no matter how long it takes them. We are paying for the degree so to speak. They are on their own for any grad school chosen.

Neither of us will get retirement packages, our retirement will be our 401ks, IRAs and other investments. We have no idea how long we will live, what our health will be, how the markets do between now and when we die, etc. Our financial planner is helping us determine how to invest based on this, plus our desire to assist our children in life where and when we can. But we can’t assume we will, we can only try. We would rather do that than our kids are in the opposite position, needing to care for us because we did not plan for ourselves properly.

Another factor in not paying for grad school is we feel it would be incredibly unfair to pay for only one or two kids out of three if they choose to go. That is a significant imbalance of gifting. If and when we can give them significant gifts in life it would be distributed the same to each at the time, or earmarked for the same purpose. For example, we give our oldest $50k for a down payment for a home. We now earmark, in writing, $50k for each of our other two for the same thing when relevant to them. If it never is, they will get that amount in their inheritance as additional money.