When talking about the richest people in the world, it’s common to hear them referred to as the “1%”. This simply references the fact that they are in the top 1% in terms of wealth. You can be very, very wealthy and be in the top 5% or the top 10%, so this is just a way of sorting out those who have the most wealth. It’s a class of its own.
What puts those people into that class? In many cases, they inherited quite a bit of money. According to one study, the top 1% averaged an inheritance of $4.8 million each.
That’s not to say that they inherited all of their wealth. Someone with a net worth of $20 million who makes $1 million per year is not simply living off of that inheritance money. However, it is often easier to get started with investing or starting a profitable company when you have $4.8 million to fund it, so those inheritances do play a big role.
The study also found that those with more money were far more likely to have inherited some — even if it’s not a full $4.8 million — than those with less. This may show, again, that simply inheriting money makes it easier to be financially successful on your own. It also could show, of course, that those who have significant wealth also come from wealthy families, and these families have the means to leave an inheritance behind, while poorer families do not.
Why estate disputes happen
Estate disputes happen for many reasons, but let’s take a look at what this type of wealth transfer could mean.
First and foremost, the wealthy have more at stake. There is more to fight over. When parents leave cash, investments, homes, art collections, vacation homes, businesses and other high-value assets, it just makes for a more complex estate division process. This can lead to confusion and disputes, especially when heirs know that so much wealth is on the line.
On top of that, many heirs may understand how important that inheritance is. They have also seen the numbers and they know how closely getting an inheritance is tied to having long-term financial success. If they feel like they do not get what they need — perhaps their parents left more to another sibling or left money to a charity instead — they could start a dispute to try to protect their own future. It’s a natural instinct.
If you do find yourself involved in a dispute, especially over a complex estate with a tremendous amount of assets on the line, make sure you are well aware of the legal options that you have.