If You Have Adult Children

If you have adult children, you might want to leave some or all of your assets to them after your death.  Some issues to think about in this regard are as follows:

  • Do you want to make an outright distribution of assets to your children, or do you want the assets to be held in trust?  Trusts can be advantageous in a number of situations. For example, holding a child’s inheritance in trust might make sense if:
    • The child is still relatively young and perhaps not yet mature enough to handle an inheritance;
    • The child has special needs;
    • The child is in a marriage that you fear might end in divorce;
    • The child is prone to over-spending; or
    • The child is in a profession in which he or she might face a lawsuit during his or her career (medicine, for example).
  • Do you want to make provisions for grandchildren?  A good estate planner can give you ideas for transferring assets to grandchildren (or to accounts or trusts for their benefit) without your incurring any adverse tax consequences.