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New study reveals average inheritance

According to a recent survey, the average Canadian who receives an inheritance gets just under $100,000. The average inheritance was $96,000 across the country; however, there were regional variations. In Atlantic Canada, the average inheritance was $32,000, while it was in excess of $120,000 in British Columbia.

About two-thirds of individuals in Ontario and throughout the country say that they stand to inherit under the terms of wills or other arrangements. While individuals may feel relieved at coming into extra money, economists say that inheritances are becoming more critical parts of people's wealth. Additionally, economists theorize that a person's success may be partly determined by his or her bloodline.

One study stated that baby boomers will acquire $1 trillion in inheritances during the next generation. This amount represents the highest transfer rate in history. An author who writes about inheritances says that inherited wealth is playing a more critical role in the determination of how individuals succeed because younger individuals are not outstripping their parents' wealth as they did in decades past. However, economists worry that this is not good for the overall economy because individuals are more dependent on their parents' success than on their own. One suggestion that proponents for change have would be to assess an inheritance tax rather than an income tax so that the distribution of wealth could become more balanced.

Individuals who would like to learn about alternatives to directly transferring assets to their heirs through a will may discuss their options with an estate planning lawyer. The lawyer might suggest using a trust that requires heirs to meet certain conditions before receiving part of their inheritance.

Source: The Huffington Post Canada, "Average Canadian Inheritance Nearly $100,000: BMO", Daniel Tencer, July 09, 2014

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