Parents and child

How To Protect Your Children’s Inheritance

This is a collaborative post

Planning for your children’s future means foreseeing plenty of different eventualities, and putting firm plans in place – sometimes decades in advance – to ensure that they remain financially stable when you’re no longer around. 

From mitigating the impact of inheritance tax to avoiding potential disputes or confusion, here’s what you need to do to protect their inheritance.

Plan Ahead

The only way to ensure that there is a solid, watertight plan in place for the days and months that follow on from your death is to make one – and that means writing a will. 

You’ve likely seen plenty of information floating around about ‘DIY’ wills, and how they can expedite the whole process but, given how important this document is, this isn’t a good idea. 

Your will needs to clearly state your wishes for who inherits what, and in a way that leaves no room for interpretation – or, more accurately, misinterpretation. This isn’t easy, and the only way for you to feel sure that you have stated everything in a way that is clear and indisputable is to have a solicitor guide you through the process.

Parents and child

Pay Close Attention to Inheritance Tax

You’ve probably heard plenty of horror stories about the high rate of inheritance tax that hits so many grieving families, but might not realise that it is possible for you to make your will much more tax efficient than it may already be. 

If you are likely to be subject to inheritance tax, one of the best times to discuss this aspect of inheritance is when you’re meeting your solicitor to create your will in the first place.

Put the Inheritance in a Trust

One of the best ways to work towards minimising the impact inheritance tax has on your children is to put the money in a trust. Doing so means that it no longer belongs to you –and this could be done years or even decades before you die.

Again, ensuring that you meet the right requirements to relinquish control over that money – and keep it away from inheritance taxes – isn’t totally straightforward, so bring this up with your solicitor, too. 

Speak to a Financial Advisor About Beneficial Investments

Creating a strong investment portfolio that you can pass onto your children is a great way of ensuring that they will continue to benefit from their inheritance long after your death, and enjoy a steady income that can support them for many years to come. 

This is a great idea but, again, something you’d be wise to speak to a professional about. Working with a financial advisor on this is certainly your best bet. 

Don’t Put it Off

All of the steps mentioned above are only going to prove effective if you see to them sooner rather than later. It’s no good knowing how to curb your children’s inheritance tax if you’re going to keep putting it off, just as it’s no good knowing how to make the process of inheritance easy if you die before you can put those measures in place.

If you are unable to leave your children a clear, comprehensive will, they may have to go through the difficult process of reaching out to contesting a will solicitors if they do not agree with the contents of the will, or, if you don’t leave a will, intestacy rules will apply.

Disclosure: This is a collaborative post

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