What my parents taught me about money, #2

Editor's note: In the coming days, members of the Consumer Reports Money staff will be sharing family lessons about money, both positive and negative. You're welcome to share your experiences, as well. Here, the second in the series: 

NEVER, never, never depend on an inheritance.

That's what I wanted to say to the woman sitting next to me at a sushi bar a few months ago, who started to complain about the stock market's dive. "It really cut into my inheritance," she announced, loud enough for the sushi chef to wince.

"I'm the only person in line to inherit from my rich uncle," she continued. "And I was counting on that money to pay for my kids' college."

"Gee, that's too bad," I said blandly. But I was thinking: Better start that 529 plan, chump.

My distrust of the family windfall is the result of several experiences both in my and my husband's families. In all cases, money that was expected didn't come through. In one case, a step-parent scooped up the pile. In another, a parent's promise to treat siblings equally turned out to be hollow. A third situation involved the unequal disposition of a family business, and a lawsuit to boot. I don't actually know how much money was at stake in any of these. It didn't matter. All led to bad feelings, some lasting decades.

To be sure, you should make it a priority to discuss money matters with your parents, to ensure their wishes are carried out, and to see to it that other parts of their estate plan are in order. And if you suspect someone is plotting to fraudulently deplete your relative's funds, you need to take action.Talk to your state or county's division of adult protective services, or an estate attorney with elder law expertise.

But beyond that, there's not much you can or should do. Your parent or elderly relative has the right to bequeath the money in whatever way he or she wants. Frustrating as it is, there is no requirement that your parents tell you the truth about their intentions. The money could go to a deserving charity. Or, it could be depleted if the parent lives longer than expected. 

That brings up the other reason to ignore a potential inheritance. When the expectation of that dough affects your relationship with your elderly relative, things can get creepy. Are you doting on your elder aunt so she'll give you more? Or, are you wishing for her to die more quickly so there's more left over? Either way, it's unseemly. 

I never considered an inheritance from my grandmother, who scraped and saved her whole life, and lived to 98. She left me a few thousand dollars. I was grateful for the money, and for the fact that it never entered into our relationship.

My advice: Place the prospect of an inheritance in the back of your mind, not in the forefront of your financial plans. Earn what you need and be grateful for anything else that happens your way.–Tobie Stanger, senior editor

Comments

[Jean Todd]

My mother was thrifty, careful and orderly with the small amount of money she had for most of her life. When she died at 93 she had a paid for small home and money in the bank. She had a power of attorney (me) and a will and had planned so that most of the assets would be held outside the estate. I was ontitle on the house and bank accounts were joint with me. I am the youngest of 5 siblings and am very fortunate that my sibs all seemed to trust me and not question my actions. As executrix, I provided them with copies of documents and invited questions but no one seemed to have a great need for more info. I know a death can precipitate some very toxic situations. We all still get along great.