A trend has been developing of late for the likes of the rich and famous. Millionaires and billionaires have publicly declared that they will be giving the lion’s share of their wealth to charity — not their children — when they die. But for many Canadians it can be common to leave a legacy for your loved ones.
Of course, the passing of a loved one is an emotional time, which could make dealing with an inheritance an ordeal. It may come at a time when you are called upon to make serious decisions for yourself and your family. “Depending on the size of the inheritance and the particular circumstances of the person receiving the inheritance, it can be life-altering from a financial perspective,” says Elise Pulver, High Net Worth Planner, Wealth Advisory Services at TD Wealth. “For example, it may allow you to buy a dream home, to retire early, or it may get you out of a financial mess. Further, emotionally, it can be a roller coaster.”
As Pulver says, prepare yourself for potential guilt about your excitement for your inheritance, or some anxiety if your priorities don’t align with those of your family. “It is typical to have mixed feelings about inheriting money after the loss of a loved one,” says Dr. Karyn Hood, a clinical psychologist at Yorkville Medical in Toronto. “People often feel conflicted about the money since they gained it as a result of the death of someone. This can take away from the joy or excitement one might typically experience from a windfall.”
Dr. Hood also says that inheriting money can be linked to feelings of self-worth. “One may feel guilty or undeserving that this money resulted from the passing of someone they loved or had a conflictual relationship with.
They can also feel a sense of obligation to spend the money in a meaningful way, or how ‘mom or dad might want or expect.’”