First, earmark the assets for your own use, and do not think of leaving everything behind as if it is your sacred duty. The hard-earned wealth accumulated over a lifetime is yours and you are entitled to it much more than your children. Shed the martyrdom, indulge yourself a bit, and forget about the naysayers.
I would allocate at least 30% of wealth to those who have earned it. Not interest income, but the principal corpus drawn down and used in one’s lifetime. Increase this allocation if your children are better off than you.
Second, do not take on the task of paying your children’s debts.
A couple had a large house that they lived in, and two smaller houses that they jointly owned with each of their two sons. Both sons held good jobs and earned high incomes. They paid the home loan EMIs for the houses, while the parents had made the down payment.
The parents now want to sell the bigger house and pay off the loans for the other two houses. Their arguement is that their grandchildren’s education costs are too high and the loan EMIs are a burden for their children. This rationale is wrong on three counts.
One, they should not give up their own house. Two, they shouldn’t subsidise where it’s not needed. Finally, they shouldn’t give what they can use in their lifetime.
Third, have a strategy for bequest that considers your situation as well as the financial situation of the children.
If they are well educated, independent, and have a stable income, their bequest is a largesse that will help with their discretionary and non-critical luxury needs. If the children have special situations, such as a handicap, illness, or specially abled children, they need ongoing financial support. Tailor the wealth transfer in a manner that
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