While nearly 70% of millennials expect some kind of inheritance from family members, only about 40% end up getting one.
Those whose family have decided on disinheriting a child could be in for a bigger surprise.
Here is everything you need to understand
Why Disinherit a Child?
When you have a child or a grandchild who you choose to disinherit, you are choosing to take that person out of your will.
One of the most common reasons people choose to disinherit a child is when they disagree with the way the child is choosing to live. However, this is not usually the best reason to do it. This is a major choice that can have serious ramifications on your heir’s future and may put you both in court. Contested estates can affect you while you are alive or they can plague your heirs who are still left on the will.
One of the most logical reasons to disinherit a child is when they have a problem they can’t control which would only get worse with an inheritance. A reason could be something like a drug or alcohol related addiction or even something related to gambling or playing the stock market. If they are already putting themselves in the poor house with financial mismanagement, things can only get worse with higher stakes.
You Want Your Child to Use It Wisely
When your goal is to get your heir to use their inheritance wisely, you might not want to focus on disinheriting your children or grandchildren. If you do not think they will use it well or could lose it in a difficult divorce, you can take measures to protect it.
Keeping it in the family is a smart choice.
When you give it to another family member, you can stipulate options for payment to your child or grandchild. That way, you do not have to hand it all over to them but you can keep the control in the hands of another more savvy family member.
What to Do If They Have Special Needs
If your child or grandchild has special needs and cannot make complicated financial decisions, you might want to keep the money from going all into their hands. If they qualify for public assistance or programs to help them lead a better life, your inheritance could hinder that.
Thankfully there are workarounds to make sure that your loved one can get the support they need. While they might need to spend some of the money on support, they could save a little with some smart filing decisions.
Disinheriting a Child Is a Major Choice
When deciding on disinheriting a child, you are making a serious decision that could impact your loved one for years to come. Before you make this decision, talk to your estate lawyer to understand the consequences.
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