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Planning to help the kids

By Jennie L. Phipps ·
Tuesday, April 19, 2011
Posted: 3 pm ET

Have you given much thought to leaving money to your grown children?

A retirement planning study released today by U.S. Trust, Bank of America Private Wealth Management, which offers wealth management for high-net-worth clients -- people with at least $3 million in assets to be managed -- found that this group of mostly boomers isn't all that interested in leaving money to their offspring.

Only 49 percent said it is important to leave a financial inheritance to the next generation -- even though 60 percent said they consider the success of their children to be one of the most important measures of their own success. While 96 percent say they are wealthier than their parents, 49 percent think it's unlikely that their children will achieve the same or greater level of wealth.

More than 75 percent said their wealth is the result of their own hard work, but they admitted that their nose-to-the-grindstone work ethic had negative aspects. Sixty-five percent said that during their working lives, they never took time off. And 50 percent said their success came at the expense of their personal lives and relationships.

Despite their own high levels of success, the people didn't seem to have a very high opinion of their children's capabilities. About 27 percent said that their children wouldn't be mature enough to handle an inheritance until they were older than 40, and 33 percent saw 35 as the magic age.

Two-thirds of the people surveyed had never talked to their adult children about the money they might inherit.


  • "They will become lazy" -- 24 percent.
  • "They will make poor decisions" -- 20 percent.
  • "They will squander money lavishly" -- 20 percent.
  • "They will be taken advantage of" -- 13 percent.
  • "They will marry the wrong person" -- 5 percent.
  • "They will squander money on addictions" -- 5 percent.

I was struck by this study in part because my mother-in-law died in January at 85, leaving each of her three children a share in the money that she had been squirreling away since she was a single mom raising them in the Philadelphia public housing projects. We were both grateful for the small windfall and sorry that she was never able to enjoy her money herself. Her frugal habits were so ingrained that she could rarely bring herself to spend what she had on anything but necessities.

My mother-in-law was proud of her children's achievements and pleased that she had something to leave them. To me, that's the right attitude, and I hope to have enough in my retirement nest egg that my children and grandchildren can eventually enjoy it, too.

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