You love your child, and you want their inheritance to provide them with a comfortable life. However, if you do not entirely trust your child’s spouse — whether because their marriage has gone through recent challenges or because of financial issues — you may want to take additional steps to protect those assets. What can you do to protect your child’s inheritance from their spouse?
Speak to your child about a prenuptial agreement.
While thinking about the potential end of a marriage is difficult for many, you may want to discuss the idea of a prenuptial or postnuptial agreement with your child. An agreement that designates their inheritance as separate property can protect your legacy from being divided in divorce. While you cannot force them to sign this kind of agreement, it can be an important first step toward protecting their inheritance.
Consider putting your child’s inheritance in trust.
If your child receives their inheritance directly through a will, it can easily become commingled with their marital property or be used by their spouse. A trust, on the other hand, provides an additional layer of protection for those assets while your child can access the funds or property left in trust. It can also protect your grandchildren’s inheritance.
A trust will also shield those funds from divorce, bankruptcy and other challenges. This can be particularly important if your child will inherit real estate, a family business and other valuable assets that may be difficult to divide in case of divorce.
With careful planning and sensitive discussions with your child, you can protect their inheritance and ensure that your estate stays in the family.