July 16, 2009

Losing a financial legacy

"Spending my kids' inheritance." It's no longer a snarky bumper sticker on the back of Mom's purple PT Cruiser. The Wall Street Journal's indispensible Brett Arends says that more boomers are telling their kids to forget the inheritance. With retirement portfolios in the toilet, parents are jettisoning previously made promise - and this includes a financial legacy.

"Millions of families are struggling with new financial realities, including heavy losses in many retirement accounts, and more prosaic expectations for future investment returns," Arends writes. "Those near retirement face the hardest choices. Should they keep working for longer? Revise their retirement plans? Scale back their standard of living now to conserve money for later? One idea that should be in the mix, much to the dismay of your children: Leave less to your heirs. Or even nothing at all.

"Maybe it's selfish, maybe it isn't. Either way, unless financial markets recover soon, many may find they have few other options."

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