Many people want to leave money to their children or grandchildren when they pass away. But that is definitely not the case for everyone. Family relationships can sometimes go south and kids and grandkids can unfortunately fail to live up to expectations or even be a cause of major disappointment.
When that happens, it can be tough to know how to handle the situation — but you do have options. You should explore them and make sure your wishes are known, as you have the right to leave the legacy that you want after working hard all your life.
You don’t have to leave an inheritance to family — but you need to make a plan
If you don’t want your kids or grandkids to inherit your money, there is no requirement that you provide it to them. While there are laws in place protecting spouses from being disinherited without their consent, no such laws exist for kids or grandkids. You have every right to leave your estate to whomever you like. This could be a friend, another relative, or even just a charitable organization that you feel excited about supporting.
The key is, however, that you must make a plan.
If you don’t provide instructions on what should happen to your assets after you are gone, then your close family members are going to inherit by default under intestacy laws. Those laws aim to give assets to close family when no other estate plans are in place.
So, you’ll need to work with an estate planning attorney to make a will, trust, or otherwise arrange for funds to transfer to those you do want the money to go to if you specifically want to make sure your kids or grandkids don’t inherit. You’ll also want to make sure the tools you use are valid and enforceable in case your family challenges your will after you are gone.
Strategic Tools for Restructuring an Estate
Simply writing a letter is rarely enough to withstand legal challenges from disinherited heirs. To ensure your wishes are honored, consider utilizing a Revocable Living Trust, which bypasses the public probate process entirely and keeps your decisions private. Additionally, update your Transfer on Death (TOD) or Payable on Death (POD) designations directly on bank and brokerage accounts, as these beneficiary forms legally override instructions left in a standard will.
Consider whether you’ll change your mind — or want to support future generations
While you have every right to disinherit your kids and your grandkids, this is also a big decision and you don’t want to do something that you end up regretting, especially if you are acting out of short-term frustration or anger.
You do have the option to structure an inheritance in a way that would allow your loved ones to inherit if they resolve the issues that have caused your unhappiness.
For example, if you don’t want to leave money to your grandkids because you think they will misspend the funds or because they didn’t finish college and you are upset with their job choices, you could create a trust with conditions — like specifying that they’ll inherit only if they get married or buy a house or graduate from college and earn a degree.
The Power of an Incentive Trust
If your disappointment stems from a lack of financial responsibility or missing milestones, you don’t have to cut your family off completely. An Incentive Trust allows you to act as a silent mentor from the future. You can mandate that funds only release to match an heir’s earned income, or distribute specific lump sums only upon achieving distinct milestones, such as a clean drug screening or completing a trade program.
Of course, there is no requirement to do anything like this, but you should think carefully about whether you want to close the door for good on leaving your assets for your kin.
Whatever you decide, it may be worth talking with a financial planner, an estate planner, or both so you can make fully informed choices about the best way to structure an inheritance and ensure that you are leaving behind the legacy that you desire so you can support the people and the causes that you do care about.
Editor’s Note: This article has been updated to include a section outlining specific legal instruments used to bypass probate, such as Revocable Living Trusts and Transfer on Death designations, alongside a new section defining the operational framework and milestone requirements of Incentive Trusts.
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