Inheritance Planning
May 7th 2007, 5:20 am
#1
Living in Perthection
Thread Starter
Joined: Mar 2003
Location: Wickedy WA WA...
Posts: 1,868
Inheritance Planning
A thread on here the other week got me thinking about this, I guess its quite an emotive subject and has the potential to draw some very differing opinions.
My intention is not to offend anyone or cause arguments or to sound greedy or be rude etc etc. But just to get people's views on the following:
Has anyone taken into account and made decisions in their life based on potential inheritance that they could receive later in life.
I think bar the granny you never knew type situations most people would have a fair idea of the wealth within there immediate elders, some of them may or may not decide to pass this on to you when they pass away.
Ignoring what the inheritance might be in terms of value, the tax implications and the obvious impact of losing someone dear to you. Should you factor in the inheritance before it actually comes to you?
For example if you felt that in the next 10years you we're likely to be left say 50K GBP (so lets assume roughly $120K AUD) and you were looking at buying a new house in the next year or so, but felt that what you were wanting was about $100K more than you really wanted to pay, would you factor in this inheritance to your decision?
It's never a subject i've given a second thought to, i've always been adamant with those close to me that I wouldnt expect a penny from them and would much rather they lived their lives doing what they want and spending everything they've ever earn't.
But inevitably I would imagine a lot of people get left something without any forward knowledge or planning of it and it could potentially make a significant difference to some.
Just to re-iterate, im not trying to offend anyone or stir up emotions. I know there are some people on here that have recently lost people dear to them so I apologise if it comes across as callus etc, thats not my intent, I just thought it was a subject rarely discussed and maybe something that should be.
Steve
My intention is not to offend anyone or cause arguments or to sound greedy or be rude etc etc. But just to get people's views on the following:
Has anyone taken into account and made decisions in their life based on potential inheritance that they could receive later in life.
I think bar the granny you never knew type situations most people would have a fair idea of the wealth within there immediate elders, some of them may or may not decide to pass this on to you when they pass away.
Ignoring what the inheritance might be in terms of value, the tax implications and the obvious impact of losing someone dear to you. Should you factor in the inheritance before it actually comes to you?
For example if you felt that in the next 10years you we're likely to be left say 50K GBP (so lets assume roughly $120K AUD) and you were looking at buying a new house in the next year or so, but felt that what you were wanting was about $100K more than you really wanted to pay, would you factor in this inheritance to your decision?
It's never a subject i've given a second thought to, i've always been adamant with those close to me that I wouldnt expect a penny from them and would much rather they lived their lives doing what they want and spending everything they've ever earn't.
But inevitably I would imagine a lot of people get left something without any forward knowledge or planning of it and it could potentially make a significant difference to some.
Just to re-iterate, im not trying to offend anyone or stir up emotions. I know there are some people on here that have recently lost people dear to them so I apologise if it comes across as callus etc, thats not my intent, I just thought it was a subject rarely discussed and maybe something that should be.
Steve
May 7th 2007, 5:56 am
#2
no longer searching
Joined: Sep 2002
Posts: 2,030
Re: Inheritance Planning
I would not factor any amount - as you said (& have told my parents so) I would rather they enjoyed life, spend it all, than keep anything aside. Also think that if they did it probably would be our children, not us, that would receive anything.
If I were to get anything I would rather put it to a use when received eg something bought reminds you (ie their money helped buy/invest) of the deceased person.
But then I am a person whom pays off their credit card each month - if can't afford it, it can wait/do without
If I were to get anything I would rather put it to a use when received eg something bought reminds you (ie their money helped buy/invest) of the deceased person.
But then I am a person whom pays off their credit card each month - if can't afford it, it can wait/do without
Last edited by walaj; May 7th 2007 at 5:59 am.
May 7th 2007, 5:57 am
#3
Gutter Gob!!
Joined: Feb 2005
Location: Perth
Posts: 13,098
Re: Inheritance Planning
A thread on here the other week got me thinking about this, I guess its quite an emotive subject and has the potential to draw some very differing opinions.
My intention is not to offend anyone or cause arguments or to sound greedy or be rude etc etc. But just to get people's views on the following:
Has anyone taken into account and made decisions in their life based on potential inheritance that they could receive later in life.
I think bar the granny you never knew type situations most people would have a fair idea of the wealth within there immediate elders, some of them may or may not decide to pass this on to you when they pass away.
Ignoring what the inheritance might be in terms of value, the tax implications and the obvious impact of losing someone dear to you. Should you factor in the inheritance before it actually comes to you?
For example if you felt that in the next 10years you we're likely to be left say 50K GBP (so lets assume roughly $120K AUD) and you were looking at buying a new house in the next year or so, but felt that what you were wanting was about $100K more than you really wanted to pay, would you factor in this inheritance to your decision?
It's never a subject i've given a second thought to, i've always been adamant with those close to me that I wouldnt expect a penny from them and would much rather they lived their lives doing what they want and spending everything they've ever earn't.
But inevitably I would imagine a lot of people get left something without any forward knowledge or planning of it and it could potentially make a significant difference to some.
Just to re-iterate, im not trying to offend anyone or stir up emotions. I know there are some people on here that have recently lost people dear to them so I apologise if it comes across as callus etc, thats not my intent, I just thought it was a subject rarely discussed and maybe something that should be.
Steve
My intention is not to offend anyone or cause arguments or to sound greedy or be rude etc etc. But just to get people's views on the following:
Has anyone taken into account and made decisions in their life based on potential inheritance that they could receive later in life.
I think bar the granny you never knew type situations most people would have a fair idea of the wealth within there immediate elders, some of them may or may not decide to pass this on to you when they pass away.
Ignoring what the inheritance might be in terms of value, the tax implications and the obvious impact of losing someone dear to you. Should you factor in the inheritance before it actually comes to you?
For example if you felt that in the next 10years you we're likely to be left say 50K GBP (so lets assume roughly $120K AUD) and you were looking at buying a new house in the next year or so, but felt that what you were wanting was about $100K more than you really wanted to pay, would you factor in this inheritance to your decision?
It's never a subject i've given a second thought to, i've always been adamant with those close to me that I wouldnt expect a penny from them and would much rather they lived their lives doing what they want and spending everything they've ever earn't.
But inevitably I would imagine a lot of people get left something without any forward knowledge or planning of it and it could potentially make a significant difference to some.
Just to re-iterate, im not trying to offend anyone or stir up emotions. I know there are some people on here that have recently lost people dear to them so I apologise if it comes across as callus etc, thats not my intent, I just thought it was a subject rarely discussed and maybe something that should be.
Steve
Last edited by northernbird; May 7th 2007 at 5:59 am.
May 7th 2007, 6:05 am
#4
Living in Perthection
Thread Starter
Joined: Mar 2003
Location: Wickedy WA WA...
Posts: 1,868
Re: Inheritance Planning
I would not factor any amount - as you said (& have told my parents so) I would rather they enjoyed life, spent it all, than keep anything aside. Also think that if they did it probably would be our children, not us that would receive anything.
If I were to get anything I would rather put it to a use when received eg something bought reminds you (ie their money helped buy/invest) of the deceased person.
But then I am a person whom pays off their credit card each month - if can't afford it, it can wait/do without
If I were to get anything I would rather put it to a use when received eg something bought reminds you (ie their money helped buy/invest) of the deceased person.
But then I am a person whom pays off their credit card each month - if can't afford it, it can wait/do without
I guess the main asset for most would be their property, as much as i'd hope they were enjoying there life and spending up on anything they wanted too, there's still likely to be a property left at the end of it and in some circumstances the value of that could be significant.
Waiting to utilise its value through inheritance might not be the most sensible thing to do (maybe
) I pay my CC off each month too
May 7th 2007, 6:12 am
#5
Lost in BE Cyberspace
Joined: Nov 2005
Location: at the bottom of a wine glass
Posts: 28,176
Re: Inheritance Planning
I had a friend who has two elderly parent who owned a rather large house, they sold him the house for a silly amount (about 50% of it's value) and he got a mortgage for it. He paid them the cash to spend however they wanted, they then rented the house off of him and paid him just enough to cover the mortgage payments. If the mortgage is paid off before they die, then they live there rent free. But the house now belongs to him to do what he wishes with after they go.
May 7th 2007, 7:03 am
#6
Living in Perthection
Thread Starter
Joined: Mar 2003
Location: Wickedy WA WA...
Posts: 1,868
Re: Inheritance Planning
I had a friend who has two elderly parent who owned a rather large house, they sold him the house for a silly amount (about 50% of it's value) and he got a mortgage for it. He paid them the cash to spend however they wanted, they then rented the house off of him and paid him just enough to cover the mortgage payments. If the mortgage is paid off before they die, then they live there rent free. But the house now belongs to him to do what he wishes with after they go.
May 7th 2007, 7:09 am
#7
Lost in BE Cyberspace
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May 7th 2007, 7:12 am
#8
A former regular of BE
Joined: Oct 2004
Location: Carramar, Perth
Posts: 6,241
Re: Inheritance Planning
As someone earlier said, mum and dad are not wealthy so I would rather they dug into my inheritance to give themselves a decent standard of living in their retirement and treated themselves to a trip to see us every couple of years. If they live as long as my grandparents all did then I will be near retirement myself when I see what is left of it. Therefore I wouldn't dream of building that income into any calculations.
May 7th 2007, 7:13 am
#9
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Joined: Sep 2002
Posts: 2,030
Re: Inheritance Planning
It shows the complications that can arise & that professional advice should be sought when there is the risk of IHT arising as the amountof money involved are likely to be large and the tax rate applicable is very sizable.
May 7th 2007, 7:19 am
#10
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Joined: Nov 2005
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Re: Inheritance Planning
(in reference to uk) there are various tax planning (legal) strategies to avoid a IHT liability arising, and Wendys friend could find they have/will not meet them and re declaration of rental income and impact of below market value rent.
It shows the complications that can arise & that professional advice should be sought when there is the risk of IHT arising as the amountof money involved are likely to be large and the tax rate applicable is very sizable.
It shows the complications that can arise & that professional advice should be sought when there is the risk of IHT arising as the amountof money involved are likely to be large and the tax rate applicable is very sizable.
Definitely
He'd owned that particular house for nearly 10 years when I knew him. His father was an accountant who specialised in tax
And as far as I know, they are still here
May 7th 2007, 8:15 am
#11
Home and Happy
Joined: Dec 2002
Location: Keep true friends and puppets close, trust no-one else...
Posts: 93,807
Re: Inheritance Planning
I know it was something I took into account. My dad always said that when he went and his flat was sold, the proceeds would go to my sister and I. So one of the reasons why I felt OK about paying UK debts from here for several years was the fact that I knew when he passed away I could clear them all. In the meantime, if he'd sold the flat and spent the cash, well that would've been my hard luck, and I'd have wished him well, but that wasn't his style.
He's now gone, debts paid, everyone happy - including him, wherever he is!
He's now gone, debts paid, everyone happy - including him, wherever he is!
May 7th 2007, 11:30 am
#12
Forum Regular
Joined: Feb 2007
Location: brisbane
Posts: 114
Re: Inheritance Planning
Grandparents now 99 fit,healthy and happy....my parents will collect the money....problem is they are fitter, healthier than me
better get on that treadmill
so not going rely on anything at the mo
better get on that treadmill so not going rely on anything at the mo
May 7th 2007, 1:40 pm
#13
Forum Regular
Joined: Aug 2005
Location: Leicester
Posts: 154
Re: Inheritance Planning
I would say NEVER factor in any Inheritance - who is to say it will come your way for certain? Even if all the family have that wish! There are lots of people out there who can tell you that their parents estate, or a good chunk of it, went to pay for Long Term Care.
Trev
Trev
May 8th 2007, 12:46 am
#14
Retired
Joined: Apr 2004
Posts: 34,649
Re: Inheritance Planning
(in reference to uk) there are various tax planning (legal) strategies to avoid a IHT liability arising, and Wendys friend could find they have/will not meet them and re declaration of rental income and impact of below market value rent.
It shows the complications that can arise & that professional advice should be sought when there is the risk of IHT arising as the amountof money involved are likely to be large and the tax rate applicable is very sizable.
It shows the complications that can arise & that professional advice should be sought when there is the risk of IHT arising as the amountof money involved are likely to be large and the tax rate applicable is very sizable.
Parents should never give away things that they cannot afford to live without. At the end of the day, inheritance tax only takes part of the estate and the children get the rest as a windfall.
Many people inherit nothing, so this windfall, even net of tax, is a bonus. Also bear in mind that in the UK, capital gains tax is not levied on gains realised at death.
