Learning, Sharing, and Teaching > Mini Money Mustaches

How much are you planning to give kids?

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whywork:
I have been thinking a lot about this question recently. Is giving kids inheritance a good thing? How much is ideal?

+ves of giving inheritance:

- Most of us are here wanting FI as we miss our freedom and our time being tied to a 9-5 desk job. By giving kids inheritance we can essentially free them (fully or partially) and give them this joy of independence
- If they like doing job then this excess money can help them buy a home early and help them lead a more comfortable life
- They may run into situations in life where they really in need of money (medical or others) and don't have it. By having the extra money, we can really help them

-ves of giving inheritance:

- Even though parts of life are painful, going through the pain and having to earn our livelihood makes us stronger and more confident in ourselves. Inheritance will not let them learn these valuable lessons. This can be offset by letting them work hard and go through the pain till mid 30s and then giving them the money where they need
- We work extra hard for saving up to give them and they may not even need it or spend it for luxuries

My plan is this:

- Pay for their college while asking them to work part time for 4-8 hours a week to learn the value of work
- Don't tell about any inheritance and let them find their job and work hard through the initial years. Teach them MMM principles and let them save hard till mid 30s where they are mostly financially independent
- Keep whatever is necessary for me and my wife's survival and distribute them extra amount as inheritance once they are mid30s

I'm hoping to give them like 500k to 750k each at this point and distribute whatever is left once we die.

What are your plans and how much (if anything) do you plan to give kids?

CindyBS:
We're leaving it all to our kids when we die.

Kid #1 is disabled and at a significantly higher risk of getting cancer, heart disease, stroke, etc. as an adult.

Kid #2 is able-bodied, but since Kid #2 may be taking care of kid#1 after I'm gone, I have no problem giving him money either. 

We are giving them both a medium sized "start of life" fund to be used for limited expenses that we approve of - not for slacking off, drinking beer, etc.  Things like: college, job training, a car, down payment for a first apartment, etc.  They will not get a free ride in college and will need to do college credits in high school (ideally) or some cheaper community college.   My guys are teens and have already been told they are expected to move out by age 23 at the latest.

The problem with not leaving an inheritance because someone thinks their kid will be lazy without it is what if the reason they can't work is something beyond their control.   Anyone can become sick or disabled at any time. 

AccidentalMiser:

--- Quote from: CindyBS on August 12, 2018, 06:56:24 PM ---We're leaving it all to our kids when we die.

Kid #1 is disabled and at a significantly higher risk of getting cancer, heart disease, stroke, etc. as an adult.

Kid #2 is able-bodied, but since Kid #2 may be taking care of kid#1 after I'm gone, I have no problem giving him money either. 

We are giving them both a medium sized "start of life" fund to be used for limited expenses that we approve of - not for slacking off, drinking beer, etc.  Things like: college, job training, a car, down payment for a first apartment, etc.  They will not get a free ride in college and will need to do college credits in high school (ideally) or some cheaper community college.   My guys are teens and have already been told they are expected to move out by age 23 at the latest.

The problem with not leaving an inheritance because someone thinks their kid will be lazy without it is what if the reason they can't work is something beyond their control.   Anyone can become sick or disabled at any time.

--- End quote ---

This is very noble.  I like the way you think about this. 

MayDay:
The issue I see is that depending on your ages, your kids may be retirement age when you die.

My grandpa is fairly well off. He is kicking at 84. My mom is 59- she didn't see any of his money when she had little kids and was paying childcare, trying to pay off student loans, buying a house, etc. Sure the money will be nice for her retirement, but at this point she and my dad have a healthy retirement savings of their own.

Meanwhile, most of his grandkids are now pretty financially stable- most of us are homeowners, have kids, have stable careers, etc. It may be his great grandkids who are in the cash-poor stage of their lives when he finally dies!

Now that's not necessarily bad- probably builds character to struggle through your 20's :) But I sure wouldn't have minded some financial assistance during the struggle of parenting newborns and toddlers!

Personally I plan to partially fund college, and then if my kids have kids, kick in decent money either to grandkids college funds, or to assist with childcare.

We do plan to potentially set aside money for our autistic child who will need extra support. As a PP mentioned we may similarly be gift his sister who will likely look out for him to some degree. But I assume by the time we die, they'll be past the point of needing our money.

mxt0133:
At the moment our inheritance for our children is to not be a burden to them in our old age.  We want to ensure we have the means to not have to depend on our children until we pass.  From there our goal is to have as close to zero assets at the time of our death.  We want to be able to help our kids if necessary as they transition into adulthood.  To me this doesn't mean doling out cash but being able to visit/move to where ever they end up and provide childcare if they need it.

I do not want to deny them the satisfaction of achieving FI if that is their goal.

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