{"id":24274,"date":"2023-10-04T13:45:03","date_gmt":"2023-10-04T13:45:03","guid":{"rendered":"https:\/\/microloannexus.com\/personal-finance\/wheres-the-inheritance-why-fewer-older-americans-are-writing-wills-or-estate-planning\/"},"modified":"2023-10-04T13:45:04","modified_gmt":"2023-10-04T13:45:04","slug":"wheres-the-inheritance-why-fewer-older-americans-are-writing-wills-or-estate-planning","status":"publish","type":"post","link":"https:\/\/microloannexus.com\/?p=24274","title":{"rendered":"Where’s the inheritance? Why fewer older Americans are writing wills or estate planning"},"content":{"rendered":"
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Fewer older Americans are writing wills, research shows, a finding that could spell trouble for survivors.<\/p>\n

The share of over-70 households with wills or trusts to distribute their assets after death has been in steady decline since the mid-2000s, according to an analysis published in August by the Center for Retirement Research at Boston College. Between 2008 and 2018, that share dropped from 70% to 63%.<\/p>\n

The downward trend reflects the growing diversity of older America. Seniors are more likely than ever to be Black or Hispanic, and those populations are less likely than non-Hispanic whites to leave a will or receive an inheritance.<\/p>\n

\u201cWe looked at who\u2019s not writing wills,\u201d said Gal Wettstein, a senior research economist at Boston College, \u201cand it\u2019s disproportionately non-Hispanic Blacks and Hispanics.\u201d<\/p>\n

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The scholarly analysis ends in 2018, but other surveys suggest a continuing decline in estate planning.<\/p>\n

Between 2020 and 2023, the share of Americans over 55 with wills\u00a0decreased from 48% to 46%, according to the 2023 Wills and Estate Planning Study by\u00a0Caring.com, the caregiver site. The study draws on a representative survey of 2,483 Americans by YouGov.<\/p>\n

\u201cIt does seem that there\u2019s a tendency to put off writing a will,\u201d Wettstein said. \u201cI think it\u2019s an unpleasant process, even in the best conditions.\u201d<\/p>\n

A large quotient of American wealth is inherited: anywhere from\u00a015% to 46%, by one analysis.<\/p>\n

The ‘American Dream’: <\/strong>Is it still worth fighting for?<\/span><\/p>\n

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In a will or trust, a person instructs how to distribute property and other assets upon their death. When someone dies without a will, the local courts kick in.<\/p>\n

And that, Wettstein said, is where the problems begin.<\/p>\n

\u2018I\u2019ve seen families break up over a piano.\u2019<\/strong><\/h2>\n

Consider the family home, which is often the most valuable household asset. When a last living parent dies, state law generally splits their dwelling among surviving children.<\/p>\n

\u201cAnd it\u2019s not easy to divide a house,\u201d Wettstein said.<\/p>\n

Survivors may disagree about what to do with the property: whether to keep it or sell it, and what to do about maintenance and property taxes. The resulting conflict can turn harmonious siblings into bitter litigants. A legal battle, of course, spawns legal fees, and it might end with the property sold at a loss.<\/p>\n

\u201cIn the end, you may fritter away a lot of the asset,\u201d Wettstein said.<\/p>\n

The same dilemma can arise in divvying up a family business, or any other prized asset.<\/p>\n

\u201cI\u2019ve seen families break up over a piano,\u201d said Ashley Folkes, a certified financial planner in Hoover, Alabama.<\/p>\n

More probate problems can emerge in nontraditional families, which are on the rise in America. Many households are headed by single adults, or by cohabiting partners who are not married, or grandparents.<\/p>\n

State laws often don\u2019t cover those scenarios. If one unmarried partner dies, for example, \u201cthe state doesn\u2019t necessarily recognize that the other is an heir,\u201d Wettstein said.<\/p>\n

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No one likes to plan for their own death<\/strong><\/h2>\n

Most Americans think writing a will is important. Most people plan to get around to it someday. Procrastination, experts say, is the enemy of estate planning.<\/p>\n

\u201cIt takes time, it\u2019s complicated, and maybe, for some people, they don\u2019t want to think about death,\u201d said Andrew Herzog, a certified financial planner in Plano, Texas.<\/p>\n

Herzog only recently got around to writing his own will.<\/p>\n

\u201cI\u2019m married, and I have one kid and another on the way, and that motivated me,\u201d he said.<\/p>\n

Parenthood motivates many Americans to write wills. Others draw inspiration from news accounts of pitched probate battles, such as the one involving R&B icon Aretha Franklin and multiple handwritten wills, one of them found in couch cushions.<\/p>\n

In the\u00a0Caring.com\u00a0survey, 42% of respondents without wills blamed simple procrastination; 35% said they didn\u2019t have enough assets to bother writing one; 15% said they didn\u2019t know how to proceed; and 14% said the process was too expensive.<\/p>\n

\u201cPeople are really busy, they\u2019re procrastinating, they don\u2019t see a need, and they think it\u2019s gonna cost them money,\u201d Folkes said.<\/p>\n

Covid spurred many Americans to write wills, but most of them were young. The share of Americans ages 18 to 34 who reported having a will jumped from 16% in 2020 to 27% in 2021, according to the\u00a0Caring.com\u00a0report. Oddly enough, the prevalence of wills declined in older age groups during that span.<\/p>\n

Hiring an attorney to prepare a will might cost $1,000 to $2,000 for an average American, financial planners say. An online will generally costs much less.<\/p>\n

Black and Hispanic families are less likely to have wills<\/strong><\/h2>\n

Procrastination and tight budgets don\u2019t fully explain why fewer older Americans are writing wills: Those are perennial concerns.<\/p>\n

Wettstein theorizes that more than anything, the decline in wills reflects the growing diversity of American seniors.<\/p>\n

The share of over-65 Americans who are racial or ethnic minorities rose from\u00a020% in 2010\u00a0to 24% in 2020, according to the federal Administration on Aging.<\/p>\n

Black and Hispanic families are markedly less likely to have wills than non-Hispanic whites, according to Boston College research. Other sources concur.<\/p>\n

In the\u00a0Caring.com\u00a0report, 39% of white people reported having wills, compared with 29% of Black people and 23% of Hispanic citizens.<\/p>\n

\u201cWhen we look at Hispanic and African-American populations, they\u2019re more likely to build wealth later in life,\u201d said Genevieve Waterman, director of economic and financial security at the National Council on Aging. \u201cThey\u2019re just so focused on building their assets,\u201d she said. That could mean they don’t get around to preparing a will.<\/p>\n

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The Boston College analysis found that Black Americans and Hispanics are significantly less likely than whites to ever receive an inheritance. Between 1992 and 2018, the study found, Hispanics were 23% less likely to reap an inheritance than non-Hispanic whites with similar socioeconomic profiles. Blacks were 25% less likely to receive a bequest.<\/p>\n

When Black or Hispanic people do inherit, it is a smaller sum. Black Americans received $75,000 less, on average, than non-Hispanic whites in the years studied by Boston College researchers. Hispanics received $41,000 less. This inheritance gap perpetuates and amplifies historic racial disparities in American wealth, the report concludes.<\/p>\n

Want to start a family squabble? Die without a will<\/strong><\/h2>\n

For some Americans, having no will is no big deal. For \u201ctraditional\u201d families, comprising a married couple (with no prior marriages) and their children, state probate laws are relatively straightforward. People with investment accounts and life insurance policies can name beneficiaries.<\/p>\n

More on life insurance: <\/strong>How to find a policy from a deceased parent<\/span><\/p>\n

For just about anyone else, financial experts say, an estate plan is crucial.<\/p>\n

\u201cIt comes down to advice, and having access to qualified advice,\u201d said Steven Stanganelli, an accredited estate planner in Amesbury, Massachusetts. “Because transitions cause problems.\u201d<\/p>\n

This article originally appeared on USA TODAY: Fewer older Americans are writing wills, planning estates<\/em><\/p>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Fewer older Americans are writing wills, research shows, a finding that could spell trouble for survivors. The share of over-70 households with wills or trusts to distribute their assets after death has been in steady decline since the mid-2000s, according to an analysis published in August by the Center for Retirement Research at Boston College.<\/p>\n","protected":false},"author":1,"featured_media":24275,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[44],"tags":[32],"class_list":{"0":"post-24274","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-featured"},"yoast_head":"\nWhere's the inheritance? 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