More than two thirds of millionaires are worried about the size of inheritance they will leave to their offspring, echoing a trend among many celebrities who have revealed they are not leaving their children anything in their will, a new survey has found.
The research, carried out by The Motley Fool, quizzed 2,000 high net worth individuals — classified as people with a net worth over $1 million — about their attitudes toward inheritances.
Two-thirds of high-net-worth (HNW) individuals are concerned about leaving too large an inheritance to their heirs.
The most common concern with leaving too much money to an heir was that the money would be used irresponsibly.
The respondents had numerous concerns about the effects of leaving too much money to their heirs, including that the wealth would be “used irresponsibly” or that it “would cause beneficiaries to be lazy.”
Recently Hollywood couple Ashton Kutcher and Mila Kunis announced they are not planning on leaving any cash for their kids in their respective wills, according to celebrity website The Fashion Ball.
The duo reportedly claimed that huge trust funds and inheritance prevent the next generation from working hard to make a living and creating their own legacy. Apparently, Kunis and Kutcher are planning on using their leftover money for charitable endeavors. However, they will financially support their kids while they are still alive.
Elton John, along with husband David Furnish, have also publicly stated they wouldn’t simply hand over their money to their children when they’re gone.
Instead, the couple chose to donate over $66 million to charity. They hope the move will teach their kids the value of hard work and respect.
“You shouldn’t give kids a silver spoon – it ruins their lives,” John has been reported as saying.
The survey also found that 68 percent of HNW individuals plan on making access to the inheritance they leave contingent on meeting specific conditions.
HNW individuals who received an inheritance of $500,000 or more were more likely to be concerned about leaving too large an inheritance. Receiving an inheritance with conditions for access was also correlated with this concern.
Taxes were also deemed important to high-net-worth individuals when it comes to inheritance, while one-third of HNW individuals plan on leaving at least half of their assets to an heir as an inheritance.
The survey also found that two-thirds of high-net-worth individuals plan on leaving part of their estate to charitable causes.
According to The Motley Fool wealthiest of US citizens receive an average inheritance of $719,000, while the bottom 50 percent averages $7,900.
“What’s clear is that high net worth individuals are concerned about the effects of leaving too large an inheritance,” Motley Fool research analyst Jack Caporal tells CNBC Make It. “They are aware of and actively considering leaving inheritances with conditions that incentivize their heirs to pick up on values that they think are important, such as hard work, doing well in school and finding a good career track.”