Large inheritances ( think trust fund) make for lazy, loser adults. I’ve seen it in real life. Teach your kids well and help them limit debt. That is the sweet spot.
And that attitude/sweeping judgement is likely why anyone that has inherited is made to feel guilty or embarrassed and dislike discussing this sort of thing in general. This is a very narrow-minded view, and implies that those that did get anything notable didn't deserve it and always end up being lazy and losers with the money. It's not black and white, and it is very insulting to anyone that did end up inheriting a large amount of money. So every trust fund and heir is a loser? Seriously?
Here's a scary thought: It has nothing to do with money or being "spoiled" by wealth. It has everything to do with the person inheriting, and their individual character. You can teach a child just about anything you'd like, but their following those teachings is another matter altogether. You might get lucky and have children that all basically have a level head on their shoulders, but don't rule out the fact that you may also end up with a kid or two that just can't handle it, or chooses not to restrict or deny themselves once they are grown.
TL/DR: spendthrifts can be born, AND made to be that way. Don't assume outside factors always dictate their character as an adult, or overestimate your influence on building said character. Do your best to instill some good values and responsibility but then hope like anything that they also have a decent character and the ability to play the long game so they will avoid going nuts with money if given a large amount.
I apparently am one of the few folks on here apparently that has had a life-changing inheritance (or at least is willing to admit to it). I received an inheritance that made me instantly FI, and within 2 years after (to figure out how investing works and get all the ducks in rows) both my husband and I retired.
And while I did not hope for or expect a single penny, I know and appreciate just how incredible a gift this was - it is humbling and scary and exciting and sometimes a source of extreme sorrow. I'm still working through my feelings even years later.
My parents taught my sibling and myself how to be responsible with money and debts, how to save, and to have a good work ethic.
I was already well on my way to retiring in my mid 50s and the only thing I lacked was investing knowledge, but figured I had decades to get that stuff down (no clue about FIRE stuff at the time). I am frugal, had no debts, and was a hard worker with a long career with much recognition.
My sibling, raised by the same parents, is fucking terrible with money. Has been since they were a child. No impulse control, buys things because they
deserve it, massive consumer debts. No ambition, no work ethic, no marketable skills. Spotty work history doing very low skill work (fast food, warehouse clerk, phone sales) with mostly no work at all over the last decade.
Considering sibling was raised the exact same way as me, you'd think we'd be roughly the same in terms of responsibility and being decent with money, but we are far apart in terms of basic world views really.
Inheriting a life changing sum didn't change who I was. I already was a hard-working, frugal person and I didn't change into a loser overnight and start throwing piles of money away on gold-plated cars or anything. And my sibling (who isn't a terrible person, just a terrible with money person) didn't turn into a frivolous spender just because they suddenly had instant wealth. They were already a spendthrift decades ago.
I took my inheritance and learned how to invest and grow it to hopefully provide a scholarship and some pretty kickass charitable trusts when I'm gone, but in the meantime, I'm doing just fine, and likely will never worry about money another second for the rest of my life.