Most people do not know how much their parents own, and many believe it is much more than it is. That might lead to complacency, with them believing they do not need to save for retirement as they will inherit a large amount from you. Telling them how little you are likely to leave them can spur them into action.
Letting someone know what they will inherit can also make it easier for them to ask you for financial help now. Maybe your child would be incredibly grateful to receive anything from you, but right now, what they really need is an extra $20,000 to be able to put a deposit down on a house and break out of the rent cycle. They might find it easier to ask you for this if they know you intend to give them it later anyway.
It can prevent them from contesting your will
If someone who expects to receive an inheritance only discovers they won’t once you are dead, they may experience a mix of strong emotions, grieving the loss of you and, at the same time, wondering how you could do this to them. They might wonder whether the will is wrong or whether someone interfered to turn them against you. They may want to challenge the will and anyone they feel might have influenced your decision.
By explaining your decision now, you give them time to accept it and allow them to present their point of view. Maybe your opinions about them are wrong. Perhaps you thought they are so wealthy that they don’t need your money, but the truth is, they are on the point of bankruptcy. Maybe you thought they just wasted money, but the truth is, they paid for their sister’s operations without telling you.
Learning more can help you determine what conversations to have about your estate plan.