Playing the Generation Game with Inheritance
There are simple ways to ensure family money stays in the family. New research reveals that more than a third of parents are reluctant to leave money to their married children when they die in case they get divorced.
The fear that their child’s spouse could end up with assets intended for grandchildren in the event of a split might seem like a sad indictment on the state of familial trust in this country.
Unfortunately it’s certainly the case that when couples divorce – and the UK still has one of the highest divorce rates in Europe – that if there is a shortfall in the “needs” of one party then an inheritance will count in the total amount of the assets.
Over 70 per cent of the 2,000 people questioned in the survey by investment management firm Rensburg Sheppards said they would like to see pre-nuptial agreements become legally binding in the UK, as this would enable them to make gifts to their children, safe in the knowledge that if they later got divorced, the money would still benefit their child.
In the current absence of legally binding pre-nups, a sensible way round this might be for grandparents to create a trust that simply misses out their child’s generation and leaves the grandchildren as beneficiaries. You can set up a trust for grandchildren either during your lifetime or in your will, to operate after your death and there is plenty of information available on the type of trust that will work best for you and your grandchildren.
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