Should an Adult Child Who Is an Aging Parent's Primary Caregiver Receive a Larger Inheritance?
We asked our panel of 30 everyday millionaires whether they plan to leave larger inheritances for their primary caregivers, and they were not in agreement.
I'm the primary caregiver for my 83-year-old mother, so I was quite interested in what our Millionaires Panel would have to say when we asked them whether they plan to leave a larger inheritance to an adult child who takes the primary caregiving role as the millionaires age.
If you're not already familiar, our Millionaires Panel is made up of 30 of the millionaires who've been featured in our ongoing My First $1 Million feature. Their identities are known only to us to protect their privacy and encourage them to speak openly.
They're teachers and entrepreneurs and project managers from all across the U.S., from Shoshoni, Wyoming, to West Lakeland, Minnesota, to Virginia Beach and San Diego. They're taking care of their families and planning for the future, which includes thinking about how their wealth will eventually be distributed.
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According to Kiplinger's Trillion Dollar Talk survey, conducted by Morning Consult, 71% of parents said they intend to divide their estate equally, but only about 50% of children expect or prefer an equal split.
Factors that were considered included past financial help and responsibility, as well as each child's financial situation and needs. So caregiving wasn't specifically mentioned in the survey.
But in our smaller survey sample through the Millionaires Panel, several respondents said they believe their caregiving children deserve a larger inheritance because "time and effort have value."
One noted that "women are often the ones who do most of the caretaking, which is like a full-time job. They deserve to get paid more."
Love and compensation
One man said he plans to leave more money, plus something extra, to show his appreciation to his caregiver. "I plan to leave a larger share to a family member taking on caregiving, but not a significant monetary difference — more symbolic or sentimental," he said.
Others don't plan to change how their estate is divided, and one noted that caregiving should be a loving act, not a transaction. "I think if one of my kids takes care of me, it will be out of love, not profit," she wrote. "I've already told them to find me a nice assisted living place and make sure my facial hair doesn't get out of control."
One respondent who cared for his mother for seven years when she had Alzheimer's said he did not feel slighted when she left him and his four out-of-state siblings equal inheritances.
"I never expected to be compensated," he wrote. "I was her son, and she was a great mother to me. My siblings certainly appreciated all that I did — that was enough for me."
What other panelists said:
- "With no children, I will likely need help in retirement, and I think it's important that I show my appreciation for my primary caretaker, which as of today is likely to be my niece."
- "If a family member is taking on caretaking for another family member or me, I plan to leave them a larger share of the estate."
- "My biggest fear is having dementia and being a burden the way so many boomer parents are to us Gen Xers right now. I don't want things to come to that, so then I start researching Final Exit and the Hemlock Society, and wow, what a rabbit hole!"
Paying for care
Another issue worth noting is our millionaires' take on relying on children for caregiving. Many of them say they plan to tap their millions to pay for long-term care, whether it's by moving to a continuing care or assisted living facility or by investing in long-term care insurance, to avoid placing the caretaking burden on their kids.
"I hope (caretaking) is not an issue," one woman said, "because I plan to be in a continuing care community. I don't want to be a burden to either child."
Another said, "I plan to enter a facility, if needed, and finance my own caregiving. I had my children when I was close to 40 and don't want to give them the stress of caring for me and their own families at the same time."
The greatest gift
Of course, not every family has a seven-figure cushion to fund a continuing care community. And, as I know firsthand from caring for my own mom, the daily reality of helping an aging parent rarely fits neatly onto a balance sheet.
Whether parents choose to divide their estate equally, leave extra to a caregiving child or use their savings to hire professional help, the panelists' varied answers do bring up a great point that was the focus of the Trillion Dollar Talk: The greatest gift you can give your family is an honest conversation and a clear plan before a crisis hits.
Related Content
- Will This 'Tax' Tear Your Family Apart, Even Though Their Inheritance Is Split Equally?
- How to Leave Different Amounts to Adult Children Without Causing a Rift
- The Caregiver Penalty: What Women Need to Know Before Hitting Pause on Their Career
- Estate Planning and Unequal Inheritances: Talking Is Key
- How 30 Everyday Millionaires Are Splitting Their Inheritances and Discussing Money With Their Kids
