Gift funds now or wait and include in my estate?

There is no right or wrong answer as it is very much a personal decision and families will have different pros and cons for their unique scenarios. But there are some things to consider when making your decision:

Weighing it up: to gift now or wait

• Once the funds are gifted, the next gen can spend as they like. You can advise them how you want to see them spend it but once it is handed over, it is out of your control.
• You have the opportunity to watch your children enjoy the money.
• If there are potential issues amongst the siblings, there is an opportunity to reduce the estate under your control and minimise any future conflict.
• When gifting funds, it is also important to assess whether the recipients have had sufficient financial education to ensure they will continue to grow the family wealth.
• What about if there are future marriage breakdowns? The funds are protected in your hands but not if you gift them now.
• If you keep the proceeds and invest them, could you possibly set your family up better for the future?
• Do you have sufficient funds available to maintain your lifestyle?
• Could family dynamics or interactions change as a result of gifting money?
• Will this gifting now account for the grandchildren – or should funds be put aside for them in the future?

These are just some considerations to work through to help you make a sound decision. Whatever you choose, what is essential is:

1. Constant and open communication amongst the whole family.
2. Discussing family values and the legacy your family wants to leave. 
3. Ensuring your children have financial education to manage such funds effectively and responsibly.

Working with clients

We work with family businesses and families on the full spectrum of Family Office aspects, including the transition of funds early as a gift – or as part of an estate. We ensure you apply the most tax-effective ways to transfer funds. Importantly, the families that have the most long-term success for all are those that transfer funds combined with financial acumen education, therefore we also design this training with our programs.

Learn more about how our Family business consulting services can help you

Visit our Family business consulting page