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Do you have a plan for your inheritance?
How to handle the transfer of wealth between Boomers and Millennials
Inheritance may sound like something only Lords and Ladies of distinguished houses have to worry about, but that isn’t the case.
An estimated 70-100,000 trillion dollars of inheritance will pass from Boomers to Millennials over the next 20-30 years, and we can guarantee that it is not all coming from titled households.
Whether you’re giving or receiving that inheritance, the management of such a—sometimes—life-changing amount of money can be intimidating and, yes, also ripe with contention and stress.
How does God want us to handle our inheritance, and what happens if we don’t agree with what to do with it? Let’s take a walk.
The importance of keeping the conversation open and kingdom-focused
If you or someone you know in your church community is dealing with passing their inheritance on or receiving an inheritance, don’t flounder in the unknown.
Sit down and really think about what type of support they, or you, may need:
What guardrails would help simplify the process?
What would best set the family up for success?
How should receivers navigate that influx of resources?
Determining what the needs are is the first step to being proactive with how you accept and provide support in these circumstances.
Hot take: the single biggest gift you'll give in your life is the one that you give when you leave this earth. Why? Because you're handing off everything you've accumulated to someone—or in some cases an organization—and that is no light matter.
There are some cultural norms that are not lined up with biblical norms when it comes to inheritance.
We don’t mean that tax mitigation, investments, and aiming to grow wealth through money management are bad things.
But the only question that really matters is what would the one who gave you those resources want you to do with them?
More is not always better (the risk of wealth handoffs)
The sad truth is that there is a high probability that your handoff of wealth to the next generation will hurt them more than help them if not done properly.
Adapting to an influx of wealth, whether that’s 4x or 40x your regular income, can be disorienting and overwhelming. Without the proper guardrails and prep, it can lead to more trouble than blessings.
That’s why referring to God’s instructions for how to handle inheritance is such a critical part of a wealth handoff.
What does he call us to do? He calls us to use our resources to expand His kingdom and do good in His name.
That means, most likely, you cannot make everyone happy with your end-of-life decisions. Following what God wants of us—unfortunately—does not typically bring everyone into a unanimous agreement.
But that doesn’t mean we should stop aiming to follow God’s will for us.
Action Items:
Help your flock unpack their options for distributing their wealth
Discussing how the amount of inheritance being bestowed on family members or organizations affects those entities is an important part of the conversation.
If there are children, help the parents objectively discuss how each child would handle an influx of wealth and help them find an outcome that makes the most sense on a case-by-case basis.
Create an environment of open communication around wealth transfers
Cultivating an open-door policy around discussing financial planning—including wealth transfers—is crucial so that people know where to turn when making those decisions.
Set the standard.
Remember that hope is not a strategy
Many parents may fall into the category of “hoping for the best” when considering how their kids will handle their inheritance.
But hope is not a strategy, and if the hand-off is not structured in a way that speaks to God’s plan, it can do more harm than good.
Taking the time to plan and unpack what makes the most sense for each person—as objectively as possible—can avoid a lot of heartache and stress.
Because we are stewards of the Lord, we have a responsibility to have those conversations to expand God’s kingdom and aim to spread blessings, not strife, in accordance with His Word.