In many cases, those who have a significant amount of wealth have inherited all of that wealth – or, at least, a portion of it. Based on some estimates, roughly one out of every five millionaires inherited their wealth.
Inherited vs. Self-Made Wealth
There are lingering questions about accuracy of estimates and assessment of inherited vs “self-made” wealth. However, understanding how clients acquired and grew their wealth is important for numerous reasons, one of which is that estate planning has to address different types of wealth differently. If you have inherited money from your parents, then you may be interested in passing some of that wealth down to the next generation. But you also have to consider income and property that you have earned or how you have compounded and dealt with property that you may have inherited.
Plus, if you are a business owner then you have to decide what happens with the succession of that business. Do your children want to take it over? Would they prefer that you sold the business and left them proceeds directly? There are also numerous tax driven complexities associated with many of these decisions which need to be addressed and thought through carefully.
There are ways to address all of these questions and many more. Just make sure you know what your goals are and that you have a complete picture of legal options you have at your disposal.