Grandparents leaving money to grandchildren?

[Honeysucklelane]

I read an article recently about the rise in grandparents leaving their will to their grandchildren instead of their children.

I believe my in-laws may be doing this and I’m not sure how I feel about it. On one hand thrilled for my children, but on the other worried they may come into a ton of money at a young age.

How do other people feel about this?

Depends on the age of the grandchildren. If they are very young adults they may squander it. We don't have any inheritance coming (to us or our children) but that is the thing I would be wary of if in that situation.

if it’s in a sole name, yes they do freeze them until the will/letters of administration/probate is produced.

joint accounts depends on the t&c. Generally joint accounts automatically go to the survivor, outside of any will, so they wouldn’t be frozen.

my mum was left with no money when my dad died. Bank froze everything. She had to apply for an allowance to live on until letters of administration were obtained. I know an executor in the same situation who got round that by not informing the bank of death so their mum still had access to his account to pay the bills- they’re in proper trouble now as a beneficiary found out.

Yes they know!!
They really are not bothered by it as they appreciate that we’ve helped them financially over the years!

@Pepperpotladles That’s all woe is me. You cannot change the fact grandparents didn’t buy homes. They probably decided it wasn’t for them and years ago you just applied for a council house and got one. People didn’t see ownership as a good thing.

As for dc. They might not be academic but all sorts of decent jobs are available and will out earn lots of graduates: train driver, electrician, selling property, working your way up via an apprenticeship. Instead of wallowing in self pity, I’d make a big effort to look at jobs that don’t a degree but require other skills.

@Badbadbunny I respect your 'no'.

My point about wills having a 'shelf life' is because people may reach a point where they no longer have capacity to update their wills.

Wills are mostly written to deal with the current situation. What will happen if I die tomorrow. Which is fine especially when there are children to look after.

The problems come when that will isn't updated. The provisions in the will may now be wholly inappropriate. Cash value bequests may unintentionally gobble up an entire estate dwindled by care home fees. Bequests which were generous at the time of writing the will may be made derisory by the impact of 30 years of inflation.

A lot of people say 'well, this is what DGPs wanted' when an estate is distributed unevenly. Except that it may well not be what they meant by the time they died 20 years after the will was written.

The big problem with writing a will is that you do have to keep updating it. If a will had a shelf life then you could just let it lapse.

my dm has included the grandchildren as well as us two
we are all adults

i think it is only fair

I do think it makes sense. It could really make a massive difference in terms of house buying and setting yourself up for life and being able to afford children themselves. I’m not inheriting from anyone so no skin in the game. The older people I know who have inherited seem to spend it on long cruises and then eaten up in care home fees.

I think there should be a balance if your children are really struggling. I think it’d be a weight off though I’m planning on downsizing to somewhere cheaper to give dc deposits when older. If some other relatives left them the money then I’d save my pennies and hsve a nicer retirement as not trying to fund them onto property ladder.

Older people losing mental capacity is the main problem meaning they can’t update nor make a new will.

Intestancy rules are a very blunt tool and would rarely give the outcome that a deceased person actually intended unless the estate is small in which case it probably doesn’t matter as the sums inherited wouldn’t be life changing.

We should encourage people to regularly update their wills but lots can’t so there’d need to be provision for that.

Problems with fixed amounts of bequests etc can easily be sorted by a decent solicitor drafting the will, using “parts” or percentages instead of absolute numbers, or building them in to the will in such a way that they lapse if the estate is too small for other bequests. Not rocket science but something that a diy will or inexperienced or poorly qualified willwriter could screw up if they don’t think through the what-ifs.

My Nanna wanted to pass it all to me and my sister but we are in Scotland so the law dictates my mothers legal entitlement unfortunately.

In this family, much of inheritances from parents has been passed on to adult dcs anyway. But we were all retired when our last parent died at 97, and were reasonably comfortable, so dcs’ needs were greater.

Dh and I will be leaving the bulk of what we have to dcs who are now mid-late 40s. Some will go to Gdcs, but we have also been contributing to Junior S&S ISAs for them, which they can access at 18, which is a bit of a worry. In case we’re no longer here (quite possible) I’m going to leave letters for them, to say blowing a bit of it will be fine, but as they will probably already have realised, it’s an awful lot easier to spend money than to earn or save it, and one day they will probably want to buy a flat or house, so a nice little nest egg will be very useful.

My parents set up trusts that the grandchildren couldn’t access until they are 30.

I think it’s great. They are reaching adulthood in a very different world to the one my generation did, and this has the potential to level the playing field a bit.

@MoistVonLI think 30 is quite late. My DD bought a flat at 26. We gave her a hefty deposit. If she had waited until 30 for a trust to cough up - 4 more years of London rents! Not financially sensible if you can buy because you earn enough.

My in laws told us their wills split the estate equally between the four grandchildren (two from us, two from DH’s brother). I think this is fair because if any of us got divorced (no plans!) then the money could go to someone no longer part of the family. Also, both me and SIL actually expect to inherit a larger amount from our respective parents in any event.

Our children are currently teens and the money when it comes (hopefully in a good few years yet) will go into our family trust in any event to be used for things like a house deposit. They won’t just be handed money.

I'm annoyed that DM has chosen to leave her estate to her adult DGCs but in a stupid and complicated way.

I'm annoyed that I am going to be stuck working with my DBs (with whom I dont get on) to sort out the mess. I know that I will be stuck doing most of the actual work because they are both useless at actually doing anything.

I'm annoyed that DM has foisted this on us without having the courtesy to ask what we thought. Except for DB1 (golden child) who thinks that managing a trust will be great fun and was party to the whole mess being created.

I'm annoyed that DM has done this to try and manipulate DBs and I into staying close to each other. We won't.

And now DM has dementia, is stuck in a care home, well past the point where anything can be done about it.

DBs and I will be stuck unravelling a trust which will be worth about 28p as the care costs burn their way through DM's assets.

The whole situation is ridiculous.

@SilviaSnuffleBum Why did you put a laughing emoji at my post?

I think it really depends on age and stage. I inherited from my grandmother but my dad got the majority. It made a real difference to me in my 20s to have the £20k she gave me. It went towards our wedding and house deposit costs. I’m quite glad I didn’t get more at that point. I appreciated the gift and my parents used the money to secure their retirement.

With my own parents, they’re likely to die in the next 5-10 years. This is an expensive period of life for us as we’re paying school fees and have a big mortgage. It would make more sense for money to pass to us and not our children. However, my in-laws are a decade younger. I think it might make more sense to pass any inheritance direct to grandchildren. We’ll (most likely) be at a very different stage, approaching retirement and our children will probably be young adults.

The sensible thing is for parents to talk to their children and plan for their wishes and not leave things as a surprise but also to regularly update wills. What makes sense at one point in time may not always be the most sensible approach.

Its unfair because someone who works hard and inherits ends up with a great deal more than someone who works just as hard and doesn't. They are then able to advantage their own children to a greater extent than the children of the hard worker without an inheritance, and so it goes on, down the generations, with the family that inherited always being one step ahead.
The link between pre existing wealth and outcomes in every aspect of life is stark, and a flow of family money, added to by each subsequent generation increases the divide between the haves and have nots and reduces the ability of the have nots to compete equally.

I think the wills should differ between life stages. Whilst the kids are young I think the money should go to the parents and allow them to give their children the best upbringing possible. There's no point leaving money to grandkids and them being wealthy if the parents are struggling to pay bills, for clubs or tutors (or whatever the kids need the thrive).

Once this kids reach adulthood it makes sense to me for the wealth to skip a generation.

@Bunnycat101 I agree, discussing plans is important. Especially if planning to deviate from the 'normal'.

It is the lack of discussion from my DM about what I now know to be an overcomplicated will which annoys me the most. It feels so lacking in courtesy to dump a load of work on people without checking with them first.

DM is deep into dementia now so there is nothing to be done about it except to try to undo the mess as quickly as possible when the time comes.

Among those I know, many parents have passed much of their own inheritances over to adult DCs anyway.

I think it’s better to leave things to children. You can include a letter if wishes saying ‘if you feel you don’t need it you can request a deed of variation so the money goes directly to the next generation.’
If it’s any consolation, my in laws won’t leave us anything. They made that very clear when we were young, newly married and yet to buy our first house. It’s some kind of misappropriated leftwing nonsense from hearing about super rich people saying likewise, but forgetting such people have already set their kids up for life. It’s a negative sentiment and I’m afraid it means I don’t help them get to medical appointments etc.

We are leaving all our money to our grandchildren.It will be in a trust fund and has an age restriction of 30 years of age.We were advised to do this by our solicitor as previously was 25.Hopefully they use the money wisely but we won’t be here to know!

@5128gap Parents have to think of dc. No one else determines this - it’s up to them. Parents can and do get jobs to earn enough ti buy a house and even move to cheaper areas to do it. Others don’t. It’s not fairness, it’s often culture and choice.

Lots of things determine your outcomes in life. Choices and hard work being just a couple amongst many people have no control over. The point is, its not fair on the DC whose parents can't or won't 'think of them'. They are as blameless and entitled to opportunity as the DC born to a different type of parent in the next bed.

@5128gap But we as a society cannot make it fair for all. No Society works like this. Many people rented 75 years ago and many of their dc had to work to buy a house. These days dc still csn but there’s choices to be made about which job and where. You make your own luck!