Minnesota residents often work hard during their lifetimes in order to save for their retirements and to hopefully have enough left over when they pass away to give something to their heirs. Depending upon the amount of wealth that decedents have in their estate, their heirs and beneficiaries could stand to receive a lot of money or assets upon their death. While some heirs may be prepared to understand and manage their newly acquired wealth, others may be overwhelmed by the windfall that is bestowed upon them.
A story was recently published about an 18-year-old man who received more than $100 million in assets from his deceased grandmother. The massive figure alone was enough to overcome him; the pressure of knowing what do to with such a large inheritance was another problem all together. His inheritance was split among assets of various forms and to complicate matters further he was not able to access any of it until he attained the age of 21.
It seems as though a lot could go wrong given the facts of the foregoing scenario. The young man could be taken advantage of by those who only wanted to gain from his inheritance. Or the young man, without proper counsel, could make bad decisions about his inheritance that could leave him financially damaged. When individuals who are unprepared to receive large inheritances become the beneficiaries of massive estates, careful planning must be undertaken to ensure that those beneficiaries are not left in a worse position than they would have been without their inheritances.
In this case, the young beneficiary was able to work with an advisor who explained his rights to him as well as how he might benefit from the management of his inheritance. While not every person who inherits from a relative will receive wealth in the amount received by this young man, all estate creators and beneficiaries can benefit from sound guidance on how to avoid problems and future litigation with the passage of money and assets at the time of the estate creators’ deaths.
Source: The Wall Street Journal, “Helping a Teenager Navigate a Giant Inheritance,” Cheryl Winokur Munk, Nov. 27, 2015