I am an only child with a very small family. I am the beneficiary of a family trust on my mom’s side that is made of assets that have passed from generations of only children (all females, coincidentally). The funds generated from the trust have been used by the “grandmothers” to pay for things for the “granddaughters”, like braces, music lessons, travel, college… DH and I have one child and, at this stage, she is adamant she will not be having children. While I know things change, DH and I are in the early stages of true estate planning and I am unsure of what to do with those assets. A very large part of me wants to leave D a (generous) fixed sum of money and establish with the balance some kind of scholarship in honor of the women who have come before me. D would still inherit the assets that DH and I have jointly and DH says my family money should be used how I see fit. Certainly, a provision will be put in place should D change her mind but, in the event she doesn’t, I’m not sure what to do. I am open to suggestions or examples for what people do when in the same kind of situation.
This has certainly been known to change in many cases. I know a few of the resulting next generation children. In at least one case the children did not appear until the mother was in her 40’s.
I agree with this. A couple of warnings. Generally this comes down to “it is harder than you think to give money away”.
I know someone who gave away quite a bit of money to siblings and siblings-in-law. About half were very thankful. The other half were annoyed that they were not given more money. There are plenty of people who you cannot give anything to without them thinking that you should have given them more.
If you give anyone money, it could change their behavior in either positive or negative ways. Some people when they get a large chunk of high tech money develop a problem where they wake up in the morning and have trouble getting themselves to do anything constructive. Some people can spend an inheritance rather quickly. Charities with good causes can sometimes later fall under the leadership of people who spend the money in ways that the original benefactors would not have approved of.
I am sorry that I do not have a clearer answer. Perhaps each of us need to raise our children as best we can, and then trust them.
You should do whatever makes you happy.
That said, I recall how hurt my cousin was to find out how much money her parents gave to their alma maters each year, while she & her H had to borrow to send their kids to college. She knew that it was her parents’ money to spend as they wished, but she still found it hurtful. If you write a will that has an “if grandkids are born at the time I die, this … if no grandkids, that” setup, and your D eventually has kids, she might feel hurt. Because of this possibility, I would suggest talking it over with your D in advance, explaining your reasoning. If she understands why you want to do what you plan to do, I imagine she will be cool with it.
@helpingmom40 - I like the combination of your idea and @kelsmom’s.
Leave your daughter a fixed sum but, for the remainder, continue with the arrangements of the family trust for any future generations that may be present when you die. If there are none, do create a scholarship or charitable trust to continue the generosity of your foremothers.
Can you use the rest of your life to choose some local beneficiaries and give out scholarship awards or other types of help right now? A bit each year so you get to enjoy watching the joy happen?
I am not really in the position to do that right yet. My own mom (the current trustee) is still alive and very much holding out hope for another generation. Any changes would most likely take place when the current trust gets settled and the subsequent one gets established.
Make sure you address the question of not only if your D changes her mind and goes on to have children, but the possibility that your D may later adopt a child or children. Will you treat them the same as biological children? We specified this in our estate planning that adoptive children of our Ds would be treated the same as biological children. If my D2 marries her current boyfriend, we may or may not choose to consider her stepson (our immediate grandson) in our wills as well.
I think the scholarship idea is lovely however leaving/not leaving the family trust to your daughter depending on whether she decides to have a family rubs me the wrong way. It does not sound as if this is was something actually written in the trust documents even though it just happened to work that way. It could come across as “punishment” for your D’s decision to not have children (a not uncommon choice among several millennial age women I know).
It isn’t a “punishment” as D would still inherit the entire rest of our estate (house, life insurance, investments, savings/retirement). If she were being disinherited from everything it would definitely seem like it was a judgement of her choices. In all honesty, if she had a sibling who had a child (or more), the wording of the trust documents would stay the same as it is now just with updated trustees and beneficiaries (it is administered by my mom and the funds are spent on D now). The trust ceases to exist once my mom passes and I am the sole beneficiary so theoretically, I would rewrite the documents in the same language as previous ones but there would be no one to be the recipient of the funds. I could sell the assets and spend the money on anything but I was looking to do something a bit more meaningful.
Is there some cause that is nearer to your D’s heart than your own? Maybe you could set up the trust to last a bit longer than your life time,perhaps until your D is 50. If she doesn’t have offspring by then, you could have the money in it go to your D’s alma mater if it’s different than your own and she enjoyed her time there or to a scholarship for her major or to fund an EC that she participated in or to a cause she is involved in or gives money to.