Wills and Estate Planning Adelaide: SKI and Estate Planning
Are you familiar with the term SKI ? It stands for Spending Kids’ Inheritance.
A wealthy & successful businessman of my acquaintance claims that his estate plan consists of spending everything to such effect that his final cheque (to the funeral director) bounces.
Here are some reasons why you may receive a smaller than expected inheritance:
1. Your parents are spending it all. Not intentionally maybe, but with the high cost of living, medical care, and long term care, their nest eggs may not be what they used to be. Nursing home costs can run as high as $80,000 a year or higher in some facilities and long term health care may be too expensive.
2. We are living longer than ever, and as we live longer, we consume more of our wealth. Australians now enjoy nearly the highest life expectancies (on average) in the world – significantly higher than even the UK and USA. However this means that the duration of our elder care is longer; the amount of care required is greater; and the costs of such care grow ever higher.
3. Medical science continues to uncover treatments for once-fatal illnesses. When coronary artery disease or cancer strikes, our survival rates today are many times higher than they were just 20 years ago. However the cost & complexities of many new treatments & medications can erode even the largest savings.
4. Baby boomers come from families that were larger than today’s families. Parents of children born between 1946 – 1964 had an average of 3.5 children, thus leaving a smaller piece of the pie to be inherited by each child.