You may have heard stories of people with a significant amount of assets saying that they do not want to leave an inheritance to their children. A number of billionaires, such as Warren Buffett, have spoken about their opposition to leaving all of their wealth to their children.
There are a variety of reasons why this happens. In some cases, they have other causes or charities that they want to leave money to instead. In other situations, they simply want to ensure that their children have a chance to carve out their own place in the world. Buffett, for example, has said that he wants to leave his children enough money that they can do anything that they want, but he does not want to leave them enough that they can do nothing at all.
Are there any alternatives?
If you have a high net worth, you may be facing the same concerns. But do you actually have to disinherit your children?
Not necessarily. For instance, if you are worried that the children will just live off of the money without working, you could set up a trust. This trust could spread the payouts out over time so that they do not get one bulk payment.
Another option would be to connect the trust to their own earnings. For instance, they can take an annual payout that is the same as their net earnings for the year, meaning that they always have an incentive to keep working and pursuing success in their own career. Their inheritance just supplements their own work, so it is impossible for them to spend their life just living off of your money.
The exact tactic that you decide to use will depend on the unique details of your family situation, but this helps to show why it is so important to know what legal options you have.