€1 million+ to leave behind

onemillion

Hey everyone,

I'm in my early 60s, single, in good health, and no dependants or debts. Thanks to years of hard work and a bit of luck, I've amassed around €1.5 million. Most of it is in cash and shares, while my house and other assets are worth about €450k. I have a solid private pension and I'm set to receive the full state pension when I become eligible. I live a simple but comfortable life and want for nothing.

Assuming everything continues as-is and I can fund my old age, the big question is: what should I do with my assets in my Will?

I have two brothers and one sister. We're not extremely close, but I'll leave them at least the current maximum tax-free amount of €32,500 each, totalling €97,500. I've also got several nieces and nephews whom I adore, so I'll give them at least the tax-free maximum of €32,500 each as well, which comes to €260,000.

I'm not sure who to leave the house and other assets to, or if they should be sold. But even after allocating all this, it barely makes a dent (€357,500), leaving me with around €1.1 million.

I'm not particularly attached to any charities, though the DSPCA crossed my mind. I was considering setting aside money for GoFundMe donations that can be allocated over time based on some criteria, or maybe creating a "trust fund"? Or I could just bite the bullet and give my siblings all my money and they'll just have to eat the inheritance tax! There are of course people who are vastly more weathly than I, who face similar questions.

Ideally, I'd love to keep it all within the family I suppose. Assuming any upcoming changes to inheritance tax won't make a huge difference overall, I'm looking for some ideas. I will talk to a financial advisor eventually of course.

Cheers for any thoughts but no begging posts, please!

tom traubert

If you're inclined, you could begin to share some of your wealth with your relatives on an annual basis, tax free. You may gift up to 3,000e p.a. to anyone with no tax implications for either party.

Whether that is a good idea or not is obviously a matter for you and you alone to decide.

Donald Trump

Could always donate it to a Donald Trump Super PAC.

Being serious, it is good to think of these things and plan. It is a fair bit of money but you might need it or use it yourself over the next 20 years. You could gift some each year to the beneficiaries as the post above suggested. If your siblings are married, that could be 42k a year. But I would also assume your siblings might be similar in age and position to yourself. If so, then the only real advantage would be that they would have a further tax threshold to give it to their own kids (or they could also pass it on to those kids now via the 3k annual exemption)

Jim_Hodge

I'd echo give an annual gift up to 3000 to those you want to benefit. While there would be tax implications over the 32000 inheritance, they can still benefit from the balance of a bigger bequest once tax is paid: Unless you have some fundamental objection to any tax being paid. I'll be, hopefully, leaving over the current tax free limits to my children but I've no problem with some tax being deducted , as they'll still benefit by receiving more than the threshold.

downtheroad

Start using the small gift exemption asap for the nieces and nephews you are so fond of. €3,000 a year times how ever many of them there are, times many years left in your life, will make a dent in that cash.

Victor

Realise that a decade in a nursing home could easily cost a million.

Who would disproportionately benefit from the money?

watchclocker

You're only young. Spend it as much as you can on yourself doing the things you enjoy. Then as someone said, keep enough for a decent care home in case you need it later.

Then will the rest to your family.

Deeec

Youve got some good advice above.

Just to add it would be a good idea for you to have a think about who is going to look after you when you do get old. Even if you go into a nursing home you still need someone looking after your affairs and property - this is an important point that's often not planned for. If you don't need nursing home you may still need someone looking out for you. Let this person know that you want them to be your carer or representative should you ever need it and make sure they are willing to assume the role. Make sure you look after this person well in your will.

Ive seen it several times that those who have assumed the role of carers to elderly relatives get nothing and those that done no care get everything!

Choose carefully! Also enjoy your own life now so that you don't have that much to leave - spend and treat yourself😀

Deeec

https://www.boards.ie/discussion/comment/122487614#Comment_122487614

When it comes to nursing homes you are better to having nothing - no money or property. A rich person gets the same treatment as a poor person in a nursing home only difference is the rich person pays more. The so called Fair deal scheme ain't that fair at all.

Damien360

https://www.boards.ie/discussion/comment/122487700#Comment_122487700

I agree with that. Early 60's is not old. Enjoy as much of it while you are completely mobile on your feet. Go on cruises, fly first class to far flung places and enjoy the fruits of your hard work. See the world before old age finally catches up with you.

Ted222

As others have alluded to, your nieces and nephews would still benefit from a higher inheritance, even if it meant paying tax.

tinytobe

https://www.boards.ie/discussion/comment/122487933#Comment_122487933

These are the best words ever written.

Jim_Hodge

https://www.boards.ie/discussion/comment/122487933#Comment_122487933

Strange as it may seem but often as people get to approach retirement age, and have plenty of funds, they often don't want to travel the world or go on cruises. You'll holiday for certain but many people are more than content to live a quiet life, while perhaps enjoying a few hobbies. If you have a decent solid pension, and funds built up, you can live a very comfortable life without making huge inroads into savings. You can do home improvements, holiday or change the car with ease. A real 1st world problem: What do I do with my money?

bilbot79

How much of a private pension have you?

I would find ways of spending that money pretty easily now.

SureYWouldntYa

The €3k annual exemption that others have pointed out for nieces and nephews could be doubled if they have spouses or long term partners since the €3k can be given to anyone. The spouses could also be left the €16,250 Group C threshold in terms of giving the most tax free benefits

If you have a niece or nephew (or sibling, or anyone really) you really like you should look at exploring the Dwelling House relief for them as it may allow them to inherit your house tax free if you think it would be worth it (not to be confused with favourite niece or nephew relief which only relates to business assets)

Tow

1.5 million will not go far if you go into a nursing home. it was costing close to 90k a year for an uncle recently. But you could use the money to pay for a live in carer etc.

The other option is to have no money, so The System and Fair Deal pay for everything.

At least you are thinking about who to leave it to. Another relative left everything to her closest relative, a niece in America. The various cousins who looked after her for years did not get a penny.

buy your dream car. First class airfares to destination of choice. 5 star holidays. Michelin star meals. I could easily blow that in retirement.

Deub

Don’t overthink it. Just live the life you want which is a luxury already.

Check with an accountant what you could do. You can do yearly gifts as said above, buy land, etc It all depends of what you like to do and how you want to share with your friends and family once you are gone.

If you know young families struggling financially around you and you think they deserve it, you could give them an anonymous cash gift.

BorneTobyWilde

There are lot of deserving people who need help, if you wanted to that is.

JVince

As mentioned above, 3k a year into an account for anyone you wish

Not the same amount, but decent enough. Absolutely no wish for first class travel. Healthy and hitting 60. Wife has good pension too.

I've 3 wonderful god children. Unrelated. I started putting money into an account for them opened by their mum. They don't know about it yet. (Eldest is 13)

There are conditions (obviously not enforceable).

It can be used for 3rd level education, (or equivalent) or towards purchase of a property.

But if used for any other purposes, I will stop contributing. (Golden handcuffs)

bureau2009

You say that ideally you would like to leave everything within the family. You will hopefully be around for at least the next 30 years so you will probably have great nieces and nephews in time. You could do worse than help with the education of the younger members of your family.

Jim_Hodge

https://www.boards.ie/discussion/comment/122488196#Comment_122488196

Without planning ahead with annual tax free gifts you can't just jump in at a point and cover education costs.

Ted222

You could do a Chuck Feeney and use it to fund good causes while you’re still alive.

John arse

Give it to Bertie!💶💶💶

billyhead

If I was in your situation Op. I would spend it on coke and hookers and live the dream in Vegas. Only joking. Its really a personal choice but as they say and you know already you can't take it with you so enjoy the rest of your days because they go so quick.

AndrewJRenko

The best gift you can give to your nieces and nephews is to avoid destroying the planet that they are inheriting by taking unnecessary flights.

Larbre34

https://www.boards.ie/discussion/comment/122489451#Comment_122489451

Do you ever let up with your do-gooder nonsense? Be quiet for Christ's sake.

Larbre34

You need to talk to a well recommended financial and tax advisor, who can help you protect your hard earned money and assets.

They will also advise on the most tax efficient way of passing on what you wish to, to your younger relatives of the next generation.

For example, while yes, passing on 3k a year now, tax free, is a good idea, you can also specify that these young people use it only for school and college, educational travel, housing and accommodation, sport or the arts etc., not for discretionary frivolities.

Importantly, you should also, between your financial advisor and solicitor, make provision for your protection and power of attorney in your later years, to provide for medical care, residential care, living will instructions and anything connected to your wishes for late and end of life, including of course, a comprehensive will.

If you wish to include any trusted family members to make decisions on your behalf, when it becomes necessary, they can do that too, but as you want for no material things now, peace of mind will become more and more valuable as you get older.

Eggs For Dinner

Yes, there are tax exemption limits for giving funds to relatives. However, there is nothing to stop you taking them for nights out and picking up the tab, taking them on holidays, using your card for a fill of oil, or leaving a little envelope of cash for them on the kitchen table, in additionto formal gifting. Then there's charity. Not the organised ones, but stuff you see for yourself locally. IMO, sport is vital for the development of young people and every club cries out for equipment.

You're at the same stage of life as me and I've passed the tipping point of saving for the future and am now enjoying spending my resources on life and helping out my family

suvigirl

I would prioritize yourself OP. Get financial advice with regards to your future, care, nursing home if needed etc.

Also enjoy what you have now, while you can. Do whatever makes you happy.

Hopefully you will have another 30 years to live, you might find there will be less to leave then you think.

In relation to inheritance tax, it may be controversial, but I see no issue with it. If I was left a sum of money, I would have no problem paying whatever tax was due. People should be grateful for whatever they get.

Jim_Hodge

https://www.boards.ie/discussion/comment/122489451#Comment_122489451

Oh FFS!!! That's scraping the bottom of the barrel.

downtheroad

https://www.boards.ie/discussion/comment/122489459#Comment_122489459

Ah no Renko is right. If OP sits on his couch, gets rid of his car, grows his own food, doesn't heat his home and avoids travel then his nieces and nephews will have a much nicer world to grow up in. 😂

I presume Renko had never taken an "unnecessary" flight?

csirl

Inheritance tax shouldnt be a reason not to leave someone something. Most people would prefer to pay tax on a large inheritance than no tax on a small one! Tax laws change over the years/decades. Let the beneficiaries sort out their own tax affairs - dont worry about it.

My personal view on inheritance is that it should stay in the family. If it were me, I"d leave it to siblings and nephews/neices. I'd also e.g. give each sibling an equal share. Nothing worse than causing bad feeling by leaving unequal amounts.

893bet

I dont think it’s the beneficiary that usually moans about inheritance tax. They are on a win either way.

It’s the disponer. It sickening to work hard and save all your life and then have 33% of it swiped on your death bed.

@OP you are young so while good to have these conversations you could need significant and expensive end of life care so don’t get rid of it too fast.

And definately pick a favourite niece/nephew….. pick wisely though…..they will need to earn it.

magicbastarder

'picking a favourite' is a good way of causing resentment, no? I assume you mean in the legal sense, but at a practical level there's a moral impetus to be fair.

Donald Trump

https://www.boards.ie/discussion/comment/122489825#Comment_122489825

Well, depending on the decisions made by the disponer, there is a lot of scope for the beneficiary to avoid paying much, if any, tax. The deceased is not taxed at all on it - i.e. it isn't taken from them.

From a philosophical point of view, it is probably the fairest form of taxation. In practice, I would admit that those who are most exposed to it are probably the best place to avoid it though.

https://www.boards.ie/discussion/comment/122489795#Comment_122489795

it’s not often that you hear that on boards! Renko is right😁😁

he normally disrupts every thread he is on with Green Party propaganda.

downtheroad

https://www.boards.ie/discussion/comment/122489825#Comment_122489825

If you're talking about Favourite Nephew Relief, this only applies to business assets, so is very unlikely to apply the OP from the information he provided.

You don't get to just nominate a favourite nephew or niece and leave more cash to them free of inheritance tax.

Marcusm

https://www.boards.ie/discussion/comment/122489451#Comment_122489451

that’s objectively untrue!

Marcusm

Eh, only if you want to actually fail to make a return - especially the envelopes of cash. You work in a regulated environment, don’t you? Maybe recognise that there are other regulated environments.

anewme

https://www.boards.ie/discussion/comment/122489825#Comment_122489825

100%. Especially if you are a PAYE worker, leaving your after tax income.

Single people are treated unfairly in the inheritance tax system, especially those in the PAYE system.

I'd advise the OP to enjoy life and spend as much as they can. The house is enough to leave to relatives.

As for the fair deal, they will take 80% of your pension.

Enjoy life now, while you can.

Charles Babbage

https://www.boards.ie/discussion/comment/122488023#Comment_122488023

However, if you do wish to see Australia then a business class seat is more comfortable, first class might not be needed. You could say that the Revenue will pay one third of this since it reduces funds on which inheritance tax will be paid.

Best to do this when you can. Although owing to some luck I am broadly in a similar situation to the OP, and very interested in travel, at present a back problem (sore, but in no way life threatening) means that I would not choose to go on even a First Class flight to Australia.

Probably best not to spend too much time concerned with tax, leave money to those who deserve it, some tax may still be deducted but a lot will still be received.

bilbot79

I don't understand why people have such a beef with inheritance tax. The state provided the environment in which your hard work could be converted to cash without being lost to gangs and mafia etc, then when you die it takes a cut to continue paying for same

Intergenerational wealth unfairly rigs the game against those who don't have pedigree, which nobody outside of Rees-Mogg & Co wants.

I agree the current limits are too low but any inheritance above say a million should be well taxed.

Some rich people become so habituated to accumulation that they never even spend. Even in this conversation the spectre of tax is encouraging posters to advise spending it, which is good for economies. Use it or lose it!

magicbastarder

i'll flip it around - why should i have to pay tax on money i've worked hard to earn, and not pay tax on money i've received as a matter of the luck of being the child of wealthy parents; money i did nothing to earn?

Iseedeadpixels

If you do plan on donating to an Animal Charity do not give any to the DSPCA, they get enough funding and do less than other rescues.

magicbastarder

anyway, to get back to the OP's question - not advice on what (s)he should do, but one option i'd possibly take were it me, based on my current circumstances.

buy a nice holiday home out west; and get as much use out of it as you can - this includes allowing the nieces and nephews you're fond of, good use of it if they want. would probably make you a popular uncle. and the thing is, it can be sold if necessary or left to them in a will for them to make the decision whether to sell it or keep it.

plus, it would avoid the flying/saving the planet conundrum!

Donald Trump

https://www.boards.ie/discussion/comment/122493363#Comment_122493363

A million?

That would be the equivalent of an extra 2m earned before tax during your lifetime for most people. i.e. a salary bump of about 45k per year for 45 years.

Furze99

Buy a good decent size of disadvantaged land in a part of the country you like, then see how to supplement the existing natural flora & fauna. Manage it back so that nature can thrive there. Then see about gifting it to a charity, local community group or the state when you die. That's a good investment and will leave the place in a little better state than otherwise.

endofrainbow

spend 95% on fast cars, fast women and booze - squander the rest !

mulbot

https://www.boards.ie/discussion/comment/122493451#Comment_122493451

Maybe because the money you've "created " into society is the first time this will be taxed-the money your wealthy parents created has also been taxed as they've earned it, having g to pay tax on that already taxed money, is nothing short of legal theft

magicbastarder

i'd happily disagree.

many people have less of an issue with paying tax on money they've worked hard to earn, than they do with paying tax on money they've been gifted without having to earn it. i don't agree with that line of logic.

to illustrate - Joe has a job paying him €33.5k pa. according to the income tax calculator on the PWC site, he will pay nearly €5k in tax.

Pat inherits exactly ten times that much from a parent, and pays no tax on it.

it'd take Joe 10 years to earn the amount in the gift Pat has just received - ten years of working - and he'd have to pay nearly €50k in tax for the privilege. which of those is theft?