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What to do with assets if there are no family survivors?

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  • What to do with assets if there are no family survivors?

    We are redoing our estate documents (loooonnnggg overdue) and are somewhat stumped at the decision of what to do with the assets if there are no survivors of the immediate family. Obviously, if my wife and I both die, the assets go to the kids. But if all four of us were to perish, where does the money go?

    In an earlier draft, about 15 years ago, the asset base was smaller, and there were allocations for parents and siblings. Presently, for various reasons, this is no longer desirable, either due to death, lack of need, or other provisions in place. So we are scratching our heads trying to come up with charities that we believe in enough to hypothetically make 6 and 7 figure donations, and few come to mind.

    The draft from 15 years ago listed nine charities, of which at most three would be worthy of our consideration today, and none at the percent levels as before.

    Anyone else have any experience with this issue?

  • #2
    I cannot really remember our plan, as we honestly didn't put a lot into that section, but I think the trust that gets established for the benefit of our kids reverts to an educational trust for family and a few close friends kids if our kids are deceased with no survivors.

    Hopefully, that doesn't come up.

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    • #3
      I share your discovery that  charitable interests change over the decades.  My younger-version philanthropist was dopey.  I am forever thankful to my tiny church-of-origin for providing accountability, socialization, ethical framework, and  is on the list, whenever our family tree dies out.

      Good job attending to your estate plan.  Easy to put off forever.  Aretha Franklin died with no plan, but dx of pancreatic CA.  Prince died with no plan, and now has 350+ surviving family members.  

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      • #4
        i'm available to receive if you want to help someone with FIRL.  too old to retire early, so financially independent, retire late. 

        our money goes to my sibling.  she would not be able to handle the size of the insured estate so we had a separate executor with longterm plans for them to take over but i didn't want her to go from being a teacher clipping coupons to where she would be without some time to plan.  i know she would probably quit working right away if given the money, but i'm not sure that's the best thing overall.    i also left some idea of what charities i want to support.  we have established a scholarship for needy kids at the local community college.  i'd like that to continue.  maybe you can do something similar.

        my sister in law is even more loaded than we are, so after some heated debate, my wife relented and we simply recorded that we love her sibling equally, left them some stuff, but not money.

        if my whole nuclear family is dead i don't know why i care.

         

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        • #5
          In the nuclear option as our attorney called it, we decided to go 50:50 between two charities that are important to each of us and would likely not change.  Husband is Type1 diabetic so 50% to Juvenile Diabetes Research Foundation.  As a pediatrician, my 50% is to St. Jude's.

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          • #6
            Grandkids and their education are a consideration, of course. Also consider those who have had a significant positive impact on your lives. I am not a believer in the theory that a genetic makeup renders one more deserving than an unrelated person or entity who is truly worthy (depends on your definition of “worthy”, of course - it’s your $$ and absolutely your decision). So, imo, carefully chosen charities should be included in your plan.

            Another consideration is which goes to who. For example, taxable accounts (different definition in my book, taxable being accounts that are fully taxable) should go to charities. Accounts with basis, such as Roths, cash, and brokerage accounts, should be left to individuals.

            And consider trusts and the provisions of distributions. You don’t want to get overly complex (I assume) but trusts give you the ability to control “beyond the grave”. If you want to ensure the recipients are worthy of the estate you have carefully nurtured with your blood, sweat, and tears, don’t simply leave your valuable possessions outright. Considering the circumstances, I believe your heirs should continue to earn your largesse after death as they would have while you were alive and able to make those decisions.
            Financial planning, investment management and CPA services for medical and high-income professionals | 270-247-6087

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            • #7
              It's good to think about this. I have four charities that I already regularly support and am very involved in. These are the four charities who will receive half of my estate in a disaster scenario. The balance goes to a surviving sibling.

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              • #8
                After the exploding turkey takes out four planned generations - it's to Autism Speaks

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                • #9
                  I am not sure I will care if I am dead and so is mY family.  I should get a plan I suppose.  I hate the issue.

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                  • #10
                    Very timely issue that might impact me too. I would leave 50% to charity, 25% to my side of the family and 25% to my wife's side.

                    Very depressing to even think about it. 

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                    • #11


                      You don’t want to get overly complex (I assume) but trusts give you the ability to control “beyond the grave”.
                      Click to expand...


                      This came up, as well. In an earlier draft, in the event that both my wife and I had died, our estate would pass into a trust, to be split between the two children, with distributions of 1/3, 1/3, 1/3, at ages 27,32, and 37. Our attorney informed me that this was out of vogue (largely to avoid excessive control beyond the grave) and to pick an age in the 25-30 range and each child gets control of their inheritance at that age.


                      Very timely issue that might impact me too. I would leave 50% to charity, 25% to my side of the family and 25% to my wife’s side.

                      We are struggling to identify any family members who would need or deserve the money.

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                      • #12


                        distributions of 1/3, 1/3, 1/3, at ages 27,32, and 37.
                        Click to expand...


                        We have our split also (25%, 25%, 50%) at ages 25, 30 and 35. I like this plan. Not sure if I care if it is out of vogue... I don't want my kids, when their frontal brains are not quite connect to the rest of the brain, to have access to our net worth.

                        I am meeting with our lawyer to review next month, so this is perfect timing for me to think about...

                        I believe we leave it as educational funds for our nieces/nephews, but we developed this when our net worth was much much smaller... so I'll keep you posted on what we decide.

                        Since I have been practicing in the same hospital for many years, might be nice to fund some programs for the community/hospital/pregnant mommas/etc. in my absence.... or fund high school scholarships for healthcare related fields, or to help recruit high quality docs to our area with loan repayments.

                        Of course, am hoping this scenario will never happen for any of us.

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                        • #13
                          If it didn’t go to my kids or grandkids than you could burn it for all I care. My church already has billions so that won’t do much and guess I dont trust or know any charities. Maybe to my high school football program.. it’s probably not going to be a ton anyway

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                          • #14


                            Our attorney informed me that this was out of vogue (largely to avoid excessive control beyond the grave) and to pick an age in the 25-30 range and each child gets control of their inheritance at that age.
                            Click to expand...


                            I disagree with your attorney.
                            Financial planning, investment management and CPA services for medical and high-income professionals | 270-247-6087

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                            • #15





                              distributions of 1/3, 1/3, 1/3, at ages 27,32, and 37. 


                              Since I have been practicing in the same hospital for many years, might be nice to fund some programs for the community/hospital/pregnant mommas/etc. in my absence…. or fund high school scholarships for healthcare related fields, or to help recruit high quality docs to our area with loan repayments.

                              Of course, am hoping this scenario will never happen for any of us.
                              Click to expand...


                              I have also practiced in the same Hospital for over 20 years. An earlier version of our plan included a large contribution to the Development fund in this unlikely scenario. Knowing better how Hospital finance works, at least in our situation, the CEO and CFO could materially benefit from the additional non-recurring income, and I am not interested in adding any to their largesse. An education fund for janitors, nursing aides, and patient transporters - that would be something I could support.

                               

                               

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