How to Prevent Your Heirs from Blowing Their Inheritance
An important part of estate planning is determining how you will pass down your assets to your children and grandchildren. In some cases, you might have some concerns about how you can do this in a way that will prevent them from blowing all of the money at once.
Here are some tips to help you ensure your heirs do not waste the money you leave to them.
Have frank conversations
It’s important you spend some time talking to your children about your wishes before you pass, and to be upfront with them in terms of how much you expect to leave to them. Talk about how you want to see them spend the money, and how it could make a difference in their lives and the lives of their children.
Having these frank conversations about your wealth and the legacy you want to leave behind can instill a sense of responsibility that might not have existed otherwise.
Trusts may allow you to take greater control of how your estate assets will be distributed. Your chosen trustee will manage your trust assets, and can handle distribution in accordance with your wishes. A well-constructed trust ensures your heirs will receive the money you wish to leave them, in installments, spread out over time, if desired.
You can put conditions on the disbursement of trust assets, or you can simply set up scheduled distributions at certain intervals.