Have Rich Parents? Here Is How Much You Will Inherit
Parents old and rich? Eying that new Veyron as the stock market lifts your family wealth to all-time heights? Don't get carried away quite yet! As estates rise in size, most families give a greater percentage to charity rather than their heirs. As JPMorgan's CIO, Michael Cembalest notes, taxes as a % of the estate disposition remain roughly constant for estates greater than $5 million. What this suggests: wealthy families have in mind a baseline level of support for their heirs, and once it is met, they channel more assets to charities.
On the bright side, bequests (parental transfers to children through their estates) are generally divided equally by child, irrespective of the child’s income, proximity to parents or behavioral differences vs. siblings (i.e. a suck up or drug-taking outcast). Various studies estimate that the “equal treatment of siblings” approach applies to 88%-92% of all estates.
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