When to give kids the inheritance #trusts

22 Mar 2023 · 1 min

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In this concise financial‑advice monologue, the speaker addresses whether parents should give children part of their inheritance while alive or wait until after death. The core guidance is to prioritize one’s own long‑term care funding first; only if that need is met should one consider early gifting. The speaker then asks whether an early gift would truly benefit the child—will it be invested or used for education? He recommends using a trust to restrict lump‑sum access. Age is another factor: adults aged roughly 40‑60 are typically in peak earning years and may not need an early windfall. Finally, tax considerations are highlighted, especially for assets like houses or stocks, which may incur significant capital‑gains tax if transferred early; thus, leaving such assets as inheritance is often preferable. The video ends with a call to sign up for the speaker’s newsletter.

Chapters

Here's a question a lot of people want answered. Does it make more sense to give your children part of their inheritance while you're alive or let them inherit it all after you're gone? First and foremost, remember this, you've got to take care of yourself first. Here's the real wild card. Do you have enough money to pay for your long-term care expenses if you need them? If the answer to that is yes, then we move on to the next question. Is giving them money early really going to make a positive difference in their life? Will they invest it, use it for education? Probably a better idea to think about how to set it up in a trust for them where they cannot get their hands on the whole lump all some at one time. Next thing you need to think about is how old will your kids be when you give them this money? If they're in the range of 40 or 45 to 60 years old, they're probably in their peak earning years. They don't need the money. The final question would be taxes. But if you're thinking about giving a house or stocks, my opinion, those are better left as an inheritance because depending on what they do with those assets, they may have to pay significant capital gains tax on it. To learn more, sign up for my newsletter in my profile page link.