This blog is the second in the series on family gifting and intergenerational transfers.  This is the first of five questions that professionals need to consider asking their clients when changes to financial plans, wills or other long term planning activities are being made in order to provide a ‘living’ gift.  This needs to be approached in a way that is suitable for your family or resentment, distrust and potential insolvency can arise-creating an irreparable chasm in your family.  Parents or relatives who have been approached for a gift should also ask themselves these questions:

Question #1:  Who are you helping with this gift/bequest?

The purpose of this question is to understand the relationship between the ‘donor or gifter’ and the ‘recipient of the gift’ as well as others affected by this exchange.  For example, siblings of the recipient may have strong feelings about gifting.  Keeping it a secret never works in the long run.  Bequests/estates are affected, family relationships change, and over-consumption by the recipient is often an outcome.  The donor’s potential to run out of money also needs to be considered.

This is a brief overview of some of the implications.  Give this question some thought when gifting activities are under consideration.  Agenomics is concerned about the unprecendented convergence of age, health and wealth and associated risks.