I don't think it's a blindspot at all - without question, the biggest issue my clients face is how best to deal with their children (in all of the ways that implies).
And I understand your situation, but I think it warps the issue to suggest that the heirs didn't earn it - maybe not, but someone earned it, and they should have the right to decide what to do with it. I don't think that is unfair.
For anyone that thinks the children didn't deserve it (because they didn't earn it), I would say this: do charities 'earn' it? You can pass your wealth to a charity, free of tax. But you shouldn't be able to pass your money to your children free of tax?
To me, that is ludicrous.
Providing for our families is among the most basic of personal desires/goals.
Isn't the difference that a charity is implied to be for society's "greater good", to help impoverished, downtrodden, people in great need of help and likely exposing that wealth or value to a large group- not just a small handful of next of kin?
No guarantees that the kids will do anything useful to society with the money hell they may just sit on it. Or should I say, arguably, "as useful" as what the charity may or may not do.
Also, I think the debate is more nuanced, targeting people who are transferring huge amounts of wealth (multiple millions). Is there a better distribution of wealth from one generation to another for the betterment of society, than a few massive consolidated portions of wealth to a small handful?
Lastly, does a large transfer of wealth from one generation to the next even really help them? No purpose in self-determination, motivation, etc. Free tickets for a generation or two of family members to not really need to contribute to society. Is that really at the end of the day the best thing for those people?
Well as much as many like to think Calgary or other Alberta cities are going to cause the bubble to blow out and ruin Canada's economy.
I don't think it's even a piss in the ocean compared to what's going on in Toronto.
Honestly, I think Politicians have to sit down and realize that Alberta went through something similar during the Boom years and right now Vancouver and Toronto are exploding.
Once? Okay.
Twice? Coincidence.
Three times? Pattern.
Its probably time to come up with a National Solution.
Maybe something like.....everyone who buys a property in Toronto has to....have a matching property in Edmonton or Moose Jaw. Or Alert!
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Funny how there's always talk of social security running out but you never hear talk of social assistance/ welfare running out.
Why is that?
Because social assistance is likely a relatively fixed percentage of people that is a % of the working population. Whereas old age based expenses like Medicare, OAS.CPP etc are increasing as the population ages.
Is it really envious random citizens who called for ramping up CPP? I thought it was government bureaucrats who were alarmed at how little Canadians are saving, and aware that impoverished seniors are going to cost the government even more through welfare, health care, etc. Because that's the thing - in a civilized country you can't just shrug and say people who didn't save enough can eat cat food and live in basements. Because the costs of their poverty (even if it is through poor planning) will come back on the public coffer one way or another. So better to force them to save.
Which further cements my opinion that in highschool, kids should be taught financial planning, retirement planning, estate taxes, mortgages, car loans, how to fill out taxes, etc etc. Basically, how the "system" works.
Too many people have no clue. Heck, I consider myself pretty informed, but even I get overwhelmed.
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Honestly, I think Politicians have to sit down and realize that Alberta went through something similar during the Boom years and right now Vancouver and Toronto are exploding.
Once? Okay.
Twice? Coincidence.
Three times? Pattern.
Its probably time to come up with a National Solution.
Maybe something like.....everyone who buys a property in Toronto has to....have a matching property in Edmonton or Moose Jaw. Or Alert!
You're asking the same people that thought 40 year mortgages would help the problem to come up with a solution.
Anyone with an introductory economics course could tell you people spending $1500/mo on a mortgage will happily keep spending $1500/mo on a mortgage and buy a house that costs twice as much if someone will let them.
Yet ultra low interest rates, looser lending requirements and 40 year mortgages were trotted out.
We've screwed ourselves for decades. We need to inflate away this debt, or we will have a serious issue in 20-30 years when people retire, still paying mortgages.
Something like the US where your interest is fixed for the entire length of your mortgage would sure help to get some flexibility in raising interest rates.
Which further cements my opinion that in highschool, kids should be taught financial planning, retirement planning, estate taxes, mortgages, car loans, how to fill out taxes, etc etc. Basically, how the "system" works.
Too many people have no clue. Heck, I consider myself pretty informed, but even I get overwhelmed.
The concepts behind those things are pretty simple, but knowing them doesn't mean people are going to make smarter decisions. There is increasing evidence that even good financial literacy programs for high school kids have little to no effect on how they actually manage their money as adults. Similar to how teaching kids what foods are healthy and how important regular exercise is doesn't really have a big effect on them actually living healthier lives. The problem is more behavior than lack of knowledge.
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Yeah, it would probably do some good to offer those financial literacy courses. But these kind of long-term and lifestyle decision often come down to pretty deeply-ingrained personality traits. For a lot of people, planning for 30 or 40 or 50 years down the road is impossibly remote, and the consequences of bad planning too abstract.
And let's keep in mind that the retirement planning we're expecting people to undertake today is a new thing. It's unlikely our grandparents or great-grandparents worried much about this stuff. They were typically looking at 5-15 years of retirement (none of my grandparents made it past 70). And many of them had employee pensions. People starting in the workforce today can expect to live to around 90. Planning for 20-25 years of retirement - without an employee plan - is a whole different kettle of fish, and not something we really have any cultural experience with.
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You're asking the same people that thought 40 year mortgages would help the problem to come up with a solution.
Anyone with an introductory economics course could tell you people spending $1500/mo on a mortgage will happily keep spending $1500/mo on a mortgage and buy a house that costs twice as much if someone will let them.
Yet ultra low interest rates, looser lending requirements and 40 year mortgages were trotted out.
We've screwed ourselves for decades. We need to inflate away this debt, or we will have a serious issue in 20-30 years when people retire, still paying mortgages.
Something like the US where your interest is fixed for the entire length of your mortgage would sure help to get some flexibility in raising interest rates.
The problem is that the public sector (globally) cannot afford the higher debt service that would come with higher interest rates (which would be the end result of higher inflation).
We are burdened with massive public debt loads around the globe at all levels of government. That means governments are highly motivated to keep interest rates down.
I believe interest rates will remain extremely low for a generation.
Yeah, it would probably do some good to offer those financial literacy courses. But these kind of long-term and lifestyle decision often come down to pretty deeply-ingrained personality traits. For a lot of people, planning for 30 or 40 or 50 years down the road is impossibly remote, and the consequences of bad planning too abstract.
And let's keep in mind that the retirement planning we're expecting people to undertake today is a new thing. It's unlikely our grandparents or great-grandparents worried much about this stuff. They were typically looking at 5-15 years of retirement (none of my grandparents made it past 70). And many of them had employee pensions. People starting in the workforce today can expect to live to around 90. Planning for 20-25 years of retirement - without an employee plan - is a whole different kettle of fish, and not something we really have any cultural experience with.
Absolutely. In fact I would argue that your numbers are drastically understated. The idea of retirement - as our parents knew it - is over. If young people today have any intention of actually 'retiring' they better plan on having enough money to be able to live off the income and not touch the principal, in perpetuity. And that means pretty substantial savings.
This is why I continue to argue that we need to get people to save substantially more than they are saving now. We need to not only encourage savings, but make it mandatory, as many other countries have done.
