How do you want to be remembered by your relatives and friends when you leave this earth? Surprisingly, more than two-thirds (69%) of Americans say they most want to be remembered for the memories they’ve shared with loved ones, according to a recent insightful report prepared by Merrill Lynch and Age Wave. This finding held constant regardless of the amount of wealth held by survey respondents.
The Merrill Lynch/Age Wave report defines the four pillars people could pass on to heirs and loved ones:
- Values and life lessons
- Instructions and wishes for late-life care and distributing assets
- Financial assets and real estate
- Personal possessions of emotional value or significance
All are important, but when forced to choose, 59% of survey respondents said that values and life lessons are the most important part of one’s legacy.
Not providing sufficient details on all these pillars, however, can cause difficulty and strife among heirs, or leave them without a sense of closure. Yet less than one in five (18%) of survey respondents age 55 and older have prepared the recommended essentials: a will, healthcare directive, and durable power of attorney.
Americans’ attitudes about financial giving have shifted
The study also revealed that most Americans now favor the idea of “giving while living,” which is one of the biggest shifts regarding inheritance. Two-thirds say they prefer to distribute part of their estate while still alive. This gives seniors both a say on how their estate is deployed and the chance to see the next generations benefiting from the inheritance. Prior generations tended to distribute all of their financial legacy after their deaths.
Another shift is Americans’ views on distributing their estate, given the family realities prevalent in the 21stcentury. Historically, Americans have distributed their financial assets in equal shares to their children. Yet two-thirds of Americans currently say that an adult child who provided them with care should receive a larger inheritance than children who didn’t. Nearly one-fourth of Americans also say that an adult child who has his or her own children should receive a larger inheritance than one who does not. And more than half (60%) say that stepchildren should receive the same amount of inheritance as biological or adopted children.
“These wishes, if implemented, could have the potential for family discord, depending on expectations they might have around inheritances,” observes Surya Kolluri, Head of Retirement Thought Leadership at Bank of America Lynch. If any of the above views – or any others that your descendants may not be expecting – are important to you, it’s critical that you express your wishes clearly in writing, including the reasons for these wishes. It’s also best if you explain your wishes personally to all concerned while you’re still alive.
Don’t leave a mess
“Think beyond the ‘get your affairs in order’ perspective that we often see in the movies, where a person waits until they’re on their deathbed to start thinking about distributing their estate.” That’s sage advice from Ken Dychtwald PhD and CEO of Age Wave, one of the authors of the study. The reality is that you should be preparing your wills and directives in your 60s, if you haven’t already, well before you think you need might them.
The trouble is, many people would rather do anything else but think about what will happen after they die. But if you don’t leave clear instructions about how to distribute your estate, along with a clear roadmap to all your assets, you could leave a messy situation for your heirs to untangle.
“If you leave a mess when you pass away, and if your heirs are fighting amongst each other, that might be the lasting memory that you leave,” Dychtwald asserts. “In this case, their heirs might not hold those fond memories that most Americans would prefer they leave behind.”
Nobody said that living, retiring, and dying in America today would be easy. But if you take the necessary time to express your wishes, organize your assets and paperwork, and prepare all the recommended legal documents, you’ll have done your best to lay the right groundwork. The Merrill Lynch and Age Wave full report provides a good road map to guide your thinking.
It also helps to explain your wishes – and the reasons – to your loved ones face to face. That can help get all your loved ones on the same page when the time comes for them to carry out your wishes. Then go enjoy your life, knowing you’ve done all you can to leave a lasting legacy for your family and friends.