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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
Albert Jenkins
December 11, 2013 at 10:43 pm

This is one of the dumbest articles I have ever read. Give it all away to charity? No way! Collins was a fool. A 1/2 million dollars would buy a nice home free and clear plus money left over. I wish I had that.

Mack
December 10, 2013 at 2:10 pm

attended trust & estate seminar - Found most novel way to bequest. Trust was set up for 3 kids. At majority, for each $1 earned, they'd get $3 from trust till age 30 at which time it was raised to $10. After 50 they'd get their distributive portion. If not into working, they'd get a salary for the hours put in volunteering for charitable org. + the age related distributions. They'd get zip if urine tests came back positive. First 2 kids got on bandwagon. 3rd kid wised up at 28 & has been on straight & narrow ever since. Testator just didn't want his kids to be waistrels. Great Idea !

Karl hatten sr
December 10, 2013 at 12:08 pm

it is much easier to. Be poor than rich.

Keith
December 10, 2013 at 11:15 am

But Keita, or whoever your name is as you can't spell YOUR OWN NAME right. We can judge as we are being judged anyway, and if someone is being stupid with their money, then they're gonna hear about it in the court of public opinion.

Keita
December 09, 2013 at 5:37 pm

It amazes me at all the "negative" comments about what one man did with an inheritance that I myself having grown up on the streets could not have done. Yet Chuck had the strength and unusual percipience for one so young to do something incredible and selfless. Who are we to "JUDGE" his actions? Yes, you or I might and probably would have done it different, but I for one applaud his action regardless of what I WOULD have done, and afterwards regardless of what he chose to do for a living. He WORKED for and EARNED his degree, if that's what it took. If he is rich, then he did it on his OWN, why be bitter, jealous or dare I say "angry" ? It's HIS LIFE!! I lost my husband last year, I'm learning to thank God for each day, for no one knows if there will b a 2moro. Congratulations Mr. Collins for one so young u made an amazingly intelligent decision. Ms. K

Keith
December 09, 2013 at 4:50 pm

Money does buy happiness to an extent. To the extent you can pay off your bills and then not worry about your home being repossessed or the lights being turned off brings relief and happiness. I do agree about the "toys" not bringing happiness. If you get enough money to get your financial house in order without extravagance, that is the level of happiness you need.
As to giving it all away, dude the Good Lord only requires 10%. He still expects you to look after yourself that. I just got an inheritance of about $600-$700K. First thing is I budgeted 10% to a charity I know and their work well. Second, I paid my bills off. Third, I took the bulk of it and am investing it wisely to increase the chance of a good retirement like my parents.
Dude, the Bible says honor your parents. Honor your parents by taking care of yourself and doing the same thing they did with their money. Hopefully, I won't have to give to the Salvation Army for your aid.

Chad
December 09, 2013 at 10:03 am

to chuck and mike, money does not buy you love. It buys you people who love money. If you take that money away those people you thought love you will go away also. Those Beautiful women that date you when your rich dont love YOU, They love your money.
Try the love of a women that will love you unconditionally, for better or worse, in sickness and Health. That is a real women and that is what makes a women beautiful.

Lyn Morse
December 08, 2013 at 4:21 pm

Mr. Collins is such a wonderful, mature young man. May he have the life he wants.... rich in achievement. I too found making something of yourself and achieving has so many rewards. Then at my age toward the end of my life at 72 I have peace knowing on earth not only I did things right in life and fulfilled a life that was a life of destiny.

Chuck
December 07, 2013 at 10:31 pm

They say money can't buy you love! Well, that isn't true, because when you have money everyone loves you. :)

MIke
December 07, 2013 at 9:25 pm

Charities = Mercedes Benz (President of Organization) + Great Dinners Out = Then they laugh at you while drinking champing and dating beautiful women.

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