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When an inheritance is a burden

By Judy Martel · Bankrate.com
Wednesday, December 4, 2013
Posted: 6 am ET

For everyone who dreams that an inherited windfall would make their lives easier, there are plenty of inheritors who say otherwise. Chuck Collins, great-grandson of packaged-meat magnate Oscar Mayer, is one of them.

Inheriting a bundle of money at a young age won't necessarily make you happy.

Inheriting a bundle of money at a young age won't necessarily make you happy.

Collins says that when he found out he would inherit a small fortune at the age of 21, his sense of self-worth was knocked a little off-kilter because he always expected to earn his own way. "I remember feeling a little bit of dread," he adds.

When young inheritors discover they may never have to work for a living, it alters their values as well as their position within their social network of peers, who are busy building careers. "Kids tend not to do well when they come into an inheritance at 21," says Madeline Levine, psychologist in Marin County Calif., and author of "The Price of Privilege" and "Teach Your Children Well."

Levine says that for many young adults, an inheritance is a burden.

Giving it all away

Collins says he felt the money would separate him from his goals and his friends. So by the time he had full custody of the inheritance, in his mid-20s, he made a somewhat drastic decision to give all the money to charity. He donated it to a variety of community foundations. "I didn't do this immediately," he says. "I had about five years to think about it."

Nearly 30 years later, Collins doesn't regret his decision. "I felt like I was doing it from a healthy place," he says. "I didn't want to be seen as a bag of money just because I was born into certain circumstances." Today, Collins earns his living as an author and expert on economic inequality and taxation. In 2008, he co-founded Wealth for the Common Good, a network of business leaders and wealthy individuals promoting fair and adequate taxation.

"My advice to inheritors is to pause, take a breath and think about what kind of values you want to live by," Collins says. "All around you, people will want you to hold onto the money; there's an entire industry devoted to wealth preservation." He encourages inheritors to figure out how much they need in order to invest in skills to earn a living and then consider giving the rest away.

Fear of being without will be a challenge that will lead many young people to hold onto the money as a safeguard, but Collins advises giving in to the impulse to be generous. "Trust yourself to share," he says.

He also suggests gaining perspective by examining the relationship between consumerism and happiness. "Look at role models of happy people and look at how much materialism is necessary," he says. More money doesn't increase happiness, he adds.

Read more on overcoming the challenges of inherited wealth.

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79 Comments
carroll redd
December 07, 2013 at 4:48 pm

jonsea, you can send a little of the money my way as I am82 and living on 800.00 a month,after the government cut my food stamps down to 50.cents a day I stay behind,i don't want to be rich,just go buy a hamburgers once in awhile this is no joke

Cats
December 07, 2013 at 4:15 pm

"Wealth For the Common Good, A network of business leaders and wealthy individuals promoting fair and adequate taxation"? Really? Here's a clue, Mr. Collins. If you and your followers don't believe you are paying as much tax as you should pay and that government at any level knows better than you how much money you should have and how you should spend it, you all can write checks today to the United States Treasury for any amount you choose. But please, don't include in your effort anyone who is not one of your followers. Many of us believe that the government already has too much of our money and wastes every dime it has.

RobRu
December 06, 2013 at 7:19 am

Well, I believe what mr. Collins did was great,@ 37 I had brain surgery and was diable for about 19 years slowly I got myself back to work never had a problem finding a job ,now I'm 75 and would wish I could win some of the lottery that some one always win,But my brother once said if you win the millions you'll be broke in weeks, my question/was why would you say that,answer/cause you'd give all away,so there what Collins done it's a great thing; RobRu

R.
December 05, 2013 at 8:23 pm

The fact is unearned money has much less value than money earned through hard work or from your own success. Inheritance money is much better given if away because you will never have any true respect or care for it. It will simply drain through your hands like loose sand. I got a nice inheritance once and it was all gone in a couple years. My son got a huge insurance settlement and it was gone in a couple years too. How many people win a large state lottery only to be back broke in a few years?

Jane Nyagwegwe
December 05, 2013 at 6:27 pm

Its very rewarding to share with less fortunate. The bible teach us to work, so for believers like us, getting it without sweating is looked as doing it against the God teaching. I share sometimes when I have less than what I need. I am sure my children will have enough to eat. My income door will always be open. People always spoiled by telling the world about what they share with others. What the right hand gives, the left doesn't have to know. God bless those with hearts of sharing.

Brother Dave
December 05, 2013 at 5:50 pm

It is lack of character, not wealth, that will spoil a young person. If they have the maturity and judgement, handling money will not be a problem.

By the way, no prosperous Chinese family would ever contemplate not doing everything necessary to sustain their wealth. It must amuse them to see Americans so ashamed of their own prosperity.

These are the kind of "problems" we all should have.

Jack Leach
December 05, 2013 at 5:46 pm

I think you did what you did was RIGHT ON !!!

Daniel
December 05, 2013 at 5:11 pm

I have worked since childhood and after working all summer @13 I had saved $87.00, which I used to buy school supplies. I think earning money is the best way to realize the value. I am also thankful and give to people in need directly, rather than through an institution. I have been fortunate to have always been able to work and achieve, but helping other has a great human reward. I commend Chuck for his empathy that so few people have today.

broke guy
December 05, 2013 at 5:02 pm

PSSSH ! I FIND IT HARD TO BELIEVE THAT MR. COLLINS GREW UP AS THE GREAT GRANDSON OF THE FOUNDER OF OSCAR MAYER. AND HE NEVER ATE FROM THE SILVER SPOON, I'M SURE GRANDPAP WASN'T SERVING HOT DOGS AT THE ANNUAL THANKSGIVING DINNER TABLE. IT IS HIGHLY DOUBTFULL HE BUSSED TABLES WORKING HIS WAY THROUGH COLLEGE EITHER. HE KNEW, JUST DIDNT KNOW HOW MUCH JACK HE WAS GONNA GET. YES COMMEND HIM FOR KICKIN (SOME) TO CHARITIES BUT (ALL) OF IT, IS A LOAD OF BOLOGNA. "NO PUN INTENDID". LIKE THE JINGLE GOES, HIS BOLOGNA HAS A FIST NAME ITS"D U M B" HIS BOLOGNA HAS A SECOND NAME ITS "A S S" :)

JONSEA
December 05, 2013 at 4:24 pm

IF U HAVE ANY SENCE U SHOULD CONTROL THE MONEY AND AFTER A SENCABLE TIME THEN DECIED THE BEST WAY TO DESBERSE IT
I AM 85 YEARS AND WITH COMON SENCSE ABOUT WHAT MONEY CAN DO TO PEOPLE I HAVE LIVED A GREAT LIFE AND WOULD LIKE TO GIVE IT SOMEONE WHO COILD HANDLE IT(WHO COULD HANDLE IT ?????
I LOV LIFE
JONSEA