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Should children get their inheritance when they become adults?

| Sep 27, 2019 | Estate Planning |

You set up a trust for your children, who are minors. If you pass away, your financial assets get passed on through the trust. You don’t want to leave money directly to your 12-year-old child, after all. The trust holds it until the kids become adults.

But should they get it as soon as they are technically adults? Legally speaking, that means when they turn 18.

First and foremost, what you decide to do is up to you. Every parent has to make this decision for themselves. You know your children. You know what resources you have. You can leave it all to them at age 18, and that may even be the right move for some children.

All that said, most experts agree that it’s typically not best for heirs to get the entire inheritance at such a young age. That may not actually be in their best interests.

Think about yourself at 18. You may still have been in high school. If you suddenly had all of the money your parents saved up, what would you have done with it? As a parent now, you want your children to do things like pay for college, start a savings account, invest the money or start a business. But, as a teen, odds are those would have been the last things on your mind.

As such, you may want to consider a trust that only pays out when the children get a bit older. You pass your wealth on to them in a way they will appreciate in the long run. Make sure you know what steps to take to get it set up.