It’s a touchy subject on many people’s minds: What will happen to my assets once I am gone?? Many people plan during their lifetime how they will distribute their inheritance and which people they want to support. Others, however, make a conscious decision to squander their wealth and inheritance.
Sounds crazy? Not necessarily. There are good reasons for squirreling away your wealth and not passing it on to future generations. However, this decision should be well thought out and certainly not made on a whim.
In this article, we will look at seven reasons why it may make sense to spend down your assets. We will look at different life situations and circumstances and highlight what aspects should be considered when making such a decision.
But what is meant by blowing one’s fortune anyway? What is meant by this is that the assets are not passed on, but rather spent. Instead of transferring the money to the children or grandchildren, it is used for luxury items, travel or other expenses.
While most people would consider this frivolous or even wasteful, such a decision can still make sense. Read on to find out what reasons there may be for throwing away your assets.
Disclaimer: We would like to point out that this article is intended as a source of information only and does not constitute advice or a recommendation with regard to financial decisions. It is strongly recommended to seek professional advice before making financial decisions.
Reason 1: Live now
The first argument for squandering your assets is the need to live in the here and now. Those who endlessly watch their finances and save everything for the future risk missing out on living life to the fullest. Because who knows if you will even be alive in a few years?
This is not about spending money senselessly or getting into debt. But it is important to treat yourself and ask yourself what is really important in your life. Maybe it is travel, new experiences or just nice things.
Those who save their assets for future generations often miss the chance to enjoy life to the fullest and to realize their own potential. That’s why you shouldn’t be afraid to take a risk and use your money for life in the here and now.
- Keywords: need, here and now, enjoy life, travel, experiences, self-actualization, risk
Reason 2: Saving is not a guarantee
Another reason why it doesn’t make sense to save your assets is that saving doesn’t guarantee a financially secure future. Savings can quickly shrink or even disappear completely due to inflation, economic crises or other unforeseen events.
It’s also important to note that saving may not be enough to cover expenses in retirement, especially if someone has a longer life expectancy than expected or has unforeseen medical expenses.
In addition, saving can lead to a lack of enjoyment in life, as you may miss out on important purchase options to enjoy life and create memories.
- One might think about planning experiences such as trips, concerts, or culinary experiences to take care of their lifestyle instead of just letting the money stew in a savings account
- It is also worth investing in your personal development and education to be successful in the long run.
So there are many reasons why it doesn’t make sense to save your wealth and instead spend the money to experience joy and abundance in life. However, this does not mean that you should necessarily blow all your possessions directly. A healthy balance between saving and enjoying the things in life is essential to living a happy and financially secure life.
Reason 3: Gaining experience
The chance to spend money can also be seen as an opportunity to gain new experiences. With your own capital you can, for example, go on a trip around the world, get to know new cultures and ways of life, and gain valuable experiences that will stay with you for a lifetime.
Spending the money on continuing education can help you acquire new skills and improve career opportunities. Or even starting your own business and gaining valuable experience in the business world.
Spending the fortune can also help to develop the personality. Challenging yourself and making brave choices can build greater confidence in your own abilities and help you get to know yourself better.
- Spending your inheritance can help you gain experience and develop your personality.
- Traveling the world, continuing your education or starting your own business can provide valuable experience.
- The challenges of spending one’s fortune can boost self-confidence and contribute to personal development.
Another reason to spend one’s wealth is the opportunity to do good. There are many charities and non-profit causes that are in dire need of financial support. By using your wealth for these purposes, you can help make the world a better place and improve the lives of many people.
In addition, being a generous donor can also serve as a role model for others and help foster a climate of solidarity and helpfulness in society. In this way, one can also have a positive influence on one’s children and grandchildren and teach them important values such as altruistic behavior and social commitment.
Last but not least, supporting charitable causes can also help save taxes. Many countries offer tax incentives for donations to charitable organizations, so the actual financial cost to the donor is often less than the face value of the donation.
- Doing good with your own assets
- Promote solidarity and a willingness to help others
- To pass on positive values to the next generation
- Take advantage of tax incentives
All in all, then, there are many good reasons to spend your assets and not focus on preserving your inheritance. The decision on how to use one’s wealth is, of course, a very personal one and depends on many individual factors. But the above reasons should definitely be taken into consideration before deciding on a strategy.
Reason 5: Breaking through expectations
First and foremost, there is the freedom to shape one’s own life according to one’s own ideas. Those who are bound by their family’s inheritance have limited ability to fulfill their own wishes. However, by squandering one’s wealth, one can break one’s own expectations and regain one’s freedom.
Another reason to blow your assets is to break the expectations of family and friends. Often high expectations are placed on the inheritance and one feels limited by the ideas of others. By squandering your wealth, you can break those expectations and finally live your own life.
- Not having to live up to expectations
- More freedom in one’s own life
- Breaking through family perceptions
- Finally living one’s own life
It is important to emphasize that everyone should make their own decisions. No one should feel compelled to spend his or her assets if he or she does not want to do so. However, one should also not be constrained by others’ expectations and should always consider what one really wants in life.
Reason 6: Give away instead of bequeathing
One way to spend one’s wealth is to give it away to the next generation. Money can be transferred, as well as property such as houses or vehicles. Why should you do this?
- Depending on the amount of assets, inheritance taxes can be avoided.
- The recipients receive the assets during their lifetime and can use them wisely, for example to finance their studies or to build a house.
- Giving a gift can be an expression of appreciation and gratitude to the recipient.
- In the event of a later inheritance, disputes among heirs can be avoided.
However, the gift should be well thought out and also take into account the financial situation of the donor, so as not to get into a financial predicament.
In addition, it can make sense to seek advice to understand and optimize the tax implications of making a gift.
Reason 7: Do not worry
One of the biggest benefits of having your assets junked is that you don’t have to worry about it anymore. Constantly worrying about how best to invest your money or how to protect it from inflation or other economic factors can become a significant stressor.
On the other hand, if you simply spend your money and enjoy it, you can be much more relaxed and enjoy life to the fullest. You don’t have to worry about how best to divide the inheritance or who gets the money after you do. With a squandered fortune, one can simply live and spend the money without giving it a second thought.
Another benefit of no longer having to worry about spending money is that you can enjoy your life much more. If you are constantly afraid that your assets will be used up or you make mistakes when investing, this can make you reluctant to spend the money. With a jubilated fortune, on the other hand, one is freer and can spend the money without worrying about whether it will still be there tomorrow.
- Do not worry
- Live life to the fullest
- More freedom to spend money