Is a Surprise Inheritance Coming?
Day 7 of our class
Is one in your future?
Jacob Knox is receiving his early. His trust fund is coming, and he wants to pay some of it forward. He knows how he spends but is unsure if it is the best long-run path.
Jacob is luckier than most for two reasons. He will receive a decent-sized inheritance, which is coming early in his life. Remarkable is his sense of responsibility. He is a donee mature beyond his thirty years who takes his small fortune seriously.
How to build?
How to give?
How to spend?
Jacobs answers start with determining his target total annual spending given his inheritance prospects and the size of his future giving.
We are all like Jacob at some level. A beneficiary of a parent or grandparents’ will and the thought that when we die, we will leave something, maybe our home, to our legacies. We need to plan, too.
Earlier this week, I introduced Sofia Cruz as an example to illustrate how to approximate the most basic living standard path. My students hit their introductory prototype case study out of the park.
The method is based on the ideas of Nobel Laureates.
Jacob’s case extends the prototype to allow for the receipt of an inheritance and the gifting to others.
It is day 7 of “Start Here” and the content is in sections 2.4 and 2.5 of Economics-Based Personal Finance.
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I found it very interesting that future assets, like inheritance, can be used to calculate the money you can spend today. Considering all the factors like that was over my head before this class. But after using MaxiFi, I have really found it interesting how many different factors, including this one, can come into play to increase your overall living standard.
What strategies can be used to ensure that an inheritance is used wisely, both for personal financial growth and for making a positive impact on others through giving?