We are at the beginning of the largest transfer of wealth the United States has ever seen. Experts predict that trillions of dollars will be passed from one generation to their designated beneficiaries over the coming decades. Those same experts also warn us that the beneficiaries of that wealth are ill-prepared to handle it. In fact, they are so ill-prepared to handle their inheritance that one in three is expected to run through their entire inheritance within two years of receiving it. If you are among the generation that will be passing its wealth on in the years to come, there are a few things you can do to try and reduce the chance that your hard-earned assets will be lost or squandered by your beneficiaries.
One thing you can do to prepare your beneficiaries to receive their inheritance is discussing it with them now. Don’t assume that your children, grandchildren, or other beneficiaries know how to handle an inheritance. It is very important that they understand the need to use it to plan for their own retirement.
The most important tool at your disposal is your estate plan. Your estate plan can be used to protect your assets from the beneficiaries themselves. Creating a trust agreement allows you to stagger the inheritance which will provide your beneficiaries with the time and experience they may need to handle it. You can also choose to leave valuable assets in the trust itself and only allow beneficiaries the use of the asset until they are much older, and less likely to squander any assets. If you want to decrease the chance that your inheritance will be lost, take the time now to create an estate plan that prevents that possibility.
If you have additional questions or concerns about your Illinois estate plan, contact the experienced Illinois estate planning attorneys at Nash Bean Ford & Brown, LLP by calling 309-944-2188 to schedule your appointment today.