As a grandparent, you know that the love you have for your grandchild is unique. You want to do everything in your power to help them through all stages of their life. You know that you may only be around to do so when they’re young, but that’s where estate planning comes into the picture. You want to know what steps you can take to make sure you help your grandchild even long after you pass away.
One thing to remember is that the second generation notoriously burns through wealth, so just leaving money to your children and hoping it gets passed on to your grandchildren actually puts that goal at risk. Odds are good they’ll get nothing unless you leave it to them directly.
There are a few problems with that, though. You could gift it to them now, but they’re too young. You could also incur serious gift taxes. How can you protect the assets and leave it to them in the future?
The best way is often to put the money into a trust. You can then decide how they can use it — such as to pay for college tuition — and when they get it. You may want to hold off on giving them the money until a set age, like 18 or 25 or even 35. Some people choose to spread an inheritance out, giving a percentage at each age. With a trust, the choice is up to you.
To really help your grandchild and to make sure your wishes are met with your estate, planning in advance is crucial. Make sure you know what steps to take.
