Tuesday, December 11, 2007

Baby Boomers Cutting Into Kid's Inheritance Money

As wealthy Baby Boomers are beginning to retire, financial advisors say that these Baby Boomers are less inclined to pass their wealth on to their grown children and grandchildren, and instead, are opting to spend their wealth on a dream retirement plan of an active, comfortable lifestyle; thus, leaving a small amount or not an ample amount of money for the next generation. Joe Montgomery, a managing director of investments at Wachovia Securities, says, “They’re a lot more worried about maintaining their lifestyle than about leaving everybody else wealthy.” In a Federal Reserve Survey of Consumer Finance interview, less than half (48.4%) thought that it was “important to leave an estate to heirs.” Do you think that parents should be able to spend their hard-earned money as they please upon retirement on themselves, or do you think they should reserve some money to help their children and grandchildren?

13 comments:

Anonymous said...

They earned the money, so they should spent it as they please. Of course they have to take care of their kids up until they are able to live by themselves. I don't think any parent would argue with that, but the people we're talking about are probably to old to have kids that age, so it's not important. So parents should and do have the choice to do whatever they please with their money. I think most parents would help their kids and grandkids, but they deserve a happy retirement as well.

Keith Chin said...

Well, like Yakov said, they did earn the money, there's no reason that they shouldn't have the right to spend it as they wish. I figure, if they do have children or grandchildren, as long as they don't dislike them for some reason, they would feel inclined to leave a good amount of money for them to live comfortably as well. While it would be nice to get lots of inheritance money, it's ultimately up to the people who actually have the money, whether they want to spend it and live nicely, or save it for their children.

Anonymous said...

Yea I guess ideally, parents will leave money for heirs and spend the rest themselves, but I think a happy retirement is more important than the children getting the money. Personally, I wouldn't care if my parents spent their money on retirement; I'd have more incentive to work harder, and I think they've done enough for me and deserved a break. So back to the Baby Boomer situation: I think the children and grandchildren should make money themselves in preparation for their own retirement.

Anonymous said...

I definitely think that parents should be able to spend their retirement money however they please. Until their children are 18, parents spend thousands of dollars a year taking care of these kids (feeding them, buying them clothes, toys, helping to pay for a college education). I think that once parents have retired from their jobs, they should use their savings on whatever they want. Some might choose to continue to save money for their children, but there is nothing wrong with parents spending their own hard-earned money during their retirement.

Zack Mar said...

Not to be rude or anything, but we dont need their stinkin money! Kids need to learn to live independantly and earn their own money through hard work.. Sure, its perfectly acceptable for parents to lend a hand financially if they so choose, however an expectation for inheritance is simply ridiculous..

Naturally, parents who have truly earned their money deserve an enjoyable retirement, spending as much money as they want to in the process.. Kids should take a mental note of that and simply strengthen their work ethic to put them in the same situation.

Zack Mar said...

Actually to make my last comment a bit more politically correct, us kids do need their stinkin money to help us until we're 18.. However we dont need the stinkin inheritance money after that..

William Chen said...

I definitely think that the wealthy Baby Boomers have the absolutely right to spend their money as they see fit. They could spend it all on themselves and leave nothing at all for their families. An analogy to this would be this : you're walking down the street and see a homeless man. You just so happen to have some spare change in your pocket. Do you give it to him or should u spend it on candy? If you do, its great because you're basically did some form of charity, but if you didn't, its not like you somehow turned into Mr Scrooge. It's not the perfect analogy but its basically the same scenario. The Baby Boomers can help out the family by giving some spare change or use it all on "candy". There isn't a right or wrong decision; it all depends on one's point of view.

Garrick Li said...

If you worked for it, the money deserves to be yours. Parents have the right not to spend a penny more on their child once the child is 18 (if they feel that way). The money these retirees have worked for their whole lives and saved through social security were intended to make their retirement enjoyable. They have every right to spend it however they wish. Those heirs and heiresses who inherit all the money from daddy are all brats anyways.

Anonymous said...

I think that Baby Boomers should be able to spend their money as they want. They have no obligation to save money for their children or grandchildren. They have had to work hard for many years and should to be able to enjoy the rest of their life by spending their wealth on anything they desire. However, I would be pretty upset if my parents didn't didn't save any money for me in the future

Pat Slack said...

I can see why everybody thinks that the people who make the money should get to keep and spend the money. But on the other side of things the parents made an obligation to themselves to take care of their children. So when their children grow up what helps them more than a couple of generous dollars. Basically when you keep all the money for only your benefit your really not being very good parents or family. It's not like your parent obligations completely vanish when your children grow into adults.I guess this really depends all on your point of view, morals, and the tradition of your family.

Haeley Meyer said...

It's all in the perspective--when you retire, of course you're going to want to spend it, but right now we're the younger generation hoping to maybe get part of that inheritance. Just like we save our money now, if our grandparents have saved money and finally get to retire, let them use what they worked for. On the other hand, they could make life easier for their kids if they managed to pass down a few dollar bills.

Addie said...

Well yes you should be able to spend your own money. Have we come to expect money when good ol' Ma and Pa kick the bucket? I think were getting ahead of ourselfs. Yes it would be nice, but expecting a nice sum of cash is too selfish for me. Then again, spending all your money on yourself is also very selfsih. So were stuck with a lesser of two evils. I say put it towards your Grandaughter's college fund. Where it will really matter in the future.

Nicole S said...

This depends on the state of the parents and their children, both financially and personally. If kids really need help or for some reason can't support themselves, them the parents should help their children as much as possible. If they have a bad relationship then that might get in the way, but, honestly, there are a surprising amount of people that cannot support themselves because of mental issues. That should definitely be taken into conisideration. But, yes, I agree that it IS their money in the first place, and they don't have to give it away (only ideally would they).