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Avoiding this Inheritance Resentment - Kids, Loans, and Inheritance
What happens if you lend one of your kids money and you die before they pay you back? If it’s a legitimate outstanding loan, it can become an asset of your estate. And your estate plan can specify how that loan should be handled when everything gets divided. But documentation matters. Without a promissory note or other clear records of the loan, your executor may be left trying to establish whether the money was actually a loan, what the terms were, and how much is still owed. And that's when things can get complicated for your kids. Maybe you lent one child money to buy a house, start a business, or get through a hard stretch. Everyone fully intended for it to be paid back. But what happens if it wasn't paid back yet and your estate plan never addressed it? If you have multiple kids and want things split evenly, that missing piece matters a lot. One child may have already received a significant financial head start. The others haven't. And now they're left trying to figure out what you would have wanted. That's where resentment can start. The good news is this is avoidable. Document the loan. Decide with your attorney how any outstanding balance should be handled at your death, including whether and how it should factor into that child's inheritance. And build those instructions into your estate plan so there's less ambiguity later. Helping a child financially can be one of the most generous things you do. Just make sure the generosity, the documentation, and the estate plan are all on the same page. If you've lent significant money to one of your kids, or you're thinking about it, this is worth a conversation with your financial planner and estate attorney. #EstatePlanning #FinancialPlanning #Inheritance #FamilyWealth #WealthManagement Save Your Spot for our Next Webinar: 🖥️ Protecting Yourself Against AI Cyber Scams and Fraud 📆 Sep 3 Noon ET 👉 Register here: www.sfcorps.com/webinar (LINK IN BIO) Join me and Jeff Lanza, Retired FBI Special Agent and cybercrime expert, as he takes us inside the criminal’s playbook to show us how today’s scams really work and what you can do to protect yourself and your family.
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