People often consider leaving one or more of their adult children out of their estate plan because they believe they have been or would be irresponsible with a large amount of money. Sometimes they plan to disinherit them because they’ve been unable to overcome substance abuse issues. In some cases, they and their children have become estranged over the years, so they have no desire to leave them anything.
Too often the decision to disinherit a child is made based on emotion. It may often be made based on circumstances that could very well change. While you may figure that you can always change your estate plan if that happens, what if you don’t get to it? What if your child turns his/her life around after you are gone?
There are alternatives to disinheritance that can ensure that your children don’t get assets they can’t handle. A good alternative is placing the assets in a trust managed by a responsible person designated by you. With an incentive trust, for example, you can direct that the assets will only be disbursed if a child completes a rehab program and continues in recovery.
You can designate that your child must complete college or get and keep a job. You can also designate just how much can be disbursed and for what. There are limits to what kind of incentives you can include. For example, you can’t require someone to marry or divorce or to practice your religion.
Another alternative to disinheritance is giving another family member power of appointment. You make them the beneficiary of a trust, but give them the authority to “re-inherit” the child if they choose.
Whatever you decide to do, and particularly if you decide to disinherit a child, it’s essential to let that person know of your decision and explain your reasoning. This can help avoid a challenge to the estate after you’re gone by a child who may assume that you were manipulated by others into making the decision.
However, you should never threaten people with disinheritance to try to force them to change their behavior. This is no way to seek love, obedience or respect.
If you have concerns about including one of your children as a beneficiary, talk with your Arizona estate planning attorney. He or she can go through your various legal options so that you can make an informed decision that’s best for your family.
Source: The Balance, “Factors to Consider Before Disinheriting a Child,” Julie Garber, accessed March 06, 2018