Money can be destructive in the wrong hands.
You have children.
You want to help set them up for success.
An inheritance can help, if done right.
According to a recent Kiplinger article titled “How to Keep Your Heirs from Blowing Their Inheritance,” an outright inheritance could be problematic for certain heirs.
Your children may be legal adults, but this does not mean they are responsible.
How can you leave an inheritance without funding addictions or youthful fancies?
How can you protect your money from their creditors or an ex-spouse?
A popular and effective option is a "spendthrift" trust.
How does it work?
You set up a trust and fund it with your assets.
At the same time you also appoint a trustee to manage the funds and control how they are used by your beneficiaries.
Often it is wise to have a trustee who is not a family member or close friend.
This can protect delicate family relationships.
Within the trust, you can provide directions regarding how and when distributions are to be made to the beneficiary.
You can even include incentives for the beneficiary to exhibit responsible behaviors as part of his or her eligibility for the distributions.
Trusts should not be attempted alone.
Discuss your family situation with an experienced estate planning attorney so you can create a trust to meet your specific circumstances.
Reference: Kiplinger (June 5, 2019) “How to Keep Your Heirs from Blowing Their Inheritance.”