Rick Kahler's Financial Awakenings

When we pass from this life, we will each leave a legacy. Regardless of our preparation—or lack thereof—for the end of life, we will indisputably leave something behind. That legacy will be both tangible and intangible.

Most of us know that the purpose of a will or living trust is to pass on the material things we want people to have. However, few of us have ever given much thought to how we wish to pass on our knowledge and beliefs.

The ancient ethical will is a beautiful tool for those who don’t want their legal will to be their only “last words.” Updated for a modern audience, the ethical will is a non-binding personal legacy letter (or recording) that is attached as a side document to legal documents.

Do you need a Living Will? Do you have a Health Power of Attorney? Or maybe you’ve wondered what the difference is between the two.

An upcoming teleclass with attorney Tom Simmons will answer those questions and more. Please join us on Thursday, August 21, at 4:00 p.m. MDT to find out more about these important topics.  To register, click here.

In many columns over the years, I have mentioned how important it is for parents and children to talk about the parents’ estate plans and the provisions of their wills. Actually having such a conversation can be terribly difficult, whether you approach it as the parent or the child. Perhaps the following suggestions may be helpful.

1.

Is there a way that parents can give children money without ruining their lives?

That may seem to be a strange question. Most of us would assume the effect would be just the opposite, that a pile of cash would solve a bucket-load of problems. Yet the issue isn’t that simple. There are a lot of misconceptions and misinformation about inheriting money.

First, receiving a lot of money can certainly have harmful consequences.

The brother of one of my acquaintances suffered a critical head injury in a car accident a few years ago. After being in a coma for several months, he died. Because he was a widower, it was not clear which family members had the authority to make medical decisions as his next of kin. His children and his parents disagreed on several crucial matters, especially whether to remove him from life support.

KFG clients were treated to author, speaker, and attorney Jeff Condon’s insights on practicle estate planning. Jeff is the author of Beyond the Grave: The Right Way and the Wrong Way of Leaving Money to your Children (and Others) (2001, Harper Collins).

I received several responses to the recent column about Mary, an elderly long-time client who was gradually deteriorating mentally and who fired me as her financial planner, co-executor, and her general and health care power of attorney. Several colleagues offered helpful suggestions.

Mary, a retired professional woman who had never married, first came to see me in 1992, when she was 70. She had invested in three blue chip companies in the 1950’s and was savvy enough to hold onto those stocks through the years. As a result, her three investments had grown to a value of $1,000,000 by the time she became my client.

In a recent column I listed some common sources of sudden wealth, including inheritance and life insurance. Several of my clients have inherited substantial sums or received large life insurance payments upon the death of a spouse. A common reaction among these heirs is guilt. There’s a sense that it’s not right to profit by […]