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You are here: Home / Archives for grandparent advice

What People Don’t Realize About Leaving Assets to Grandchildren

August 7, 2025 by Catherine Reed Leave a Comment

What People Don’t Realize About Leaving Assets to Grandchildren
Image source: 123rf.com

Leaving something behind for your grandchildren may feel like the ultimate expression of love and legacy. But without careful planning, what seems like a generous and well-meaning gift can create more confusion than comfort. There are legal, financial, and emotional details that most people simply don’t consider when leaving assets to grandchildren. And unfortunately, what you don’t know can lead to delays, disputes, or even lost value. If you’re hoping to pass on part of your estate to the next generation, here’s what you absolutely need to understand first.

1. Minors Can’t Legally Inherit Assets Directly

It’s a common misconception that you can name a grandchild and they’ll automatically receive their inheritance at any age. In reality, minors can’t legally control assets like cash, property, or investment accounts. If you name a child under 18 as a beneficiary without creating a trust or custodial account, a court may have to appoint someone to manage the funds. That process takes time, adds expense, and might put the money under the control of someone you didn’t intend. When it comes to leaving assets to grandchildren, legal structure matters more than most people realize.

2. Naming a Grandchild May Trigger Generation-Skipping Taxes

The IRS has a specific tax rule called the Generation-Skipping Transfer Tax (GSTT), which applies when assets skip a generation—such as going directly from grandparents to grandchildren. If your estate is large enough, this tax can apply on top of standard estate taxes. While not everyone will be subject to GSTT, it’s important to consult with a financial advisor or estate attorney if your estate is even approaching the taxable threshold. Many families don’t realize this tax even exists until it’s too late to avoid it. When leaving assets to grandchildren, it’s wise to check how federal and state tax laws may apply.

3. Your Children May Be Left Out of the Loop

Sometimes grandparents intend to gift directly to grandchildren as a way to help with college or future milestones. But in doing so, they may unintentionally skip their own children—who could be counting on part of the inheritance. This decision can lead to emotional tension or even legal disputes, especially if the parents of the grandchild were expecting different arrangements. If you’re planning on leaving assets to grandchildren instead of their parents, it’s essential to communicate that clearly. Transparency helps prevent hurt feelings and misunderstandings down the line.

4. Trusts Can Be a Game-Changer

Setting up a trust is one of the most effective ways to leave assets to grandchildren safely and with clear instructions. A trust lets you specify when and how the money can be used—for example, only for education, housing, or after a certain age. It also protects the funds from being misused, lost in a lawsuit, or absorbed into a divorce. A properly structured trust can also help avoid probate and reduce tax burdens. While it requires upfront planning, a trust provides control, protection, and peace of mind.

5. Life Insurance Policies Need Updated Beneficiaries

Life insurance is one of the most common ways people leave money to loved ones, but the beneficiary forms need to be filled out with precision. If you name a grandchild and they are still a minor when the policy pays out, the funds could be tied up in court or end up with a guardian you didn’t choose. Many people forget to revisit these documents after major life changes like births, deaths, or divorces. When leaving assets to grandchildren through life insurance, it’s better to direct the funds to a trust or custodian. That ensures the money is managed according to your wishes.

6. UTMA and UGMA Accounts Have Age Limits

If you decide to leave money in a custodial account under the Uniform Transfers to Minors Act (UTMA) or Uniform Gifts to Minors Act (UGMA), know that these accounts automatically transfer to the child at the age of majority—typically 18 or 21. That means your grandchild will get full control of the money at that age, whether they’re ready or not. Some kids will handle that responsibility well, while others may not. When leaving assets to grandchildren, think carefully about when and how they should gain access. If you want more say in how the money is used, a trust offers more control.

7. College Financial Aid Can Be Impacted

Grandparent gifts can affect a grandchild’s eligibility for financial aid in unexpected ways. Assets held in a grandchild’s name, or distributions from a grandparent-owned 529 plan, may count against them on the FAFSA and reduce aid packages. Timing matters, and in some cases, delaying a gift until later in their college years can reduce the impact. Families who don’t consider this may accidentally make it harder for their grandchild to afford college. If you’re leaving assets to grandchildren with education in mind, speak with a financial aid expert to plan wisely.

8. Sentimental Items Can Cause Disagreements Too

It’s not just about money—family heirlooms, jewelry, collectibles, and personal items can also cause tension if not clearly assigned. When grandparents leave assets to grandchildren without listing these items or explaining their wishes, it opens the door to confusion and conflict. Take time to label or document who should receive what and include these details in your estate plan. Sentimental gifts should be treated with the same care as financial ones. Clarity now avoids heartbreak later.

Planning With the Next Generation in Mind

Leaving assets to grandchildren is a beautiful way to create a lasting legacy, but it takes more than good intentions to do it right. From tax rules to legal logistics, there’s a lot more involved than simply writing a name on a document. With careful planning, open communication, and the right legal tools, you can ensure that your gift truly helps the next generation thrive. A little preparation now can save your family confusion, conflict, and financial loss later.

Are you considering leaving assets to grandchildren? What steps have you taken to make sure your wishes are clear? Share your thoughts in the comments!

Read More:

Do You Know the Estate Planning Essentials to Protect Your Family’s Future?

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Catherine Reed
Catherine Reed

Catherine is a tech-savvy writer who has focused on the personal finance space for more than eight years. She has a Bachelor’s in Information Technology and enjoys showcasing how tech can simplify everyday personal finance tasks like budgeting, spending tracking, and planning for the future. Additionally, she’s explored the ins and outs of the world of side hustles and loves to share what she’s learned along the way. When she’s not working, you can find her relaxing at home in the Pacific Northwest with her two cats or enjoying a cup of coffee at her neighborhood cafe.

Filed Under: Estate Planning Tagged With: Estate planning, family legacy, generational wealth, grandparent advice, inheritance tips, leaving assets to grandchildren, Planning, trusts and wills

9 Reasons Your Adult Grandkids Don’t Like You: Yes Money Is One of Them

March 18, 2025 by Latrice Perez Leave a Comment

Adult Grandkids
Image Source: 123rf.com

Many grandparents assume that their relationship with their grandchildren will always be strong, no matter what. But as grandkids grow into adulthood, family dynamics change. Some grandparents find themselves feeling distant, unwelcome, or even ignored by the younger generation.

If your adult grandchildren seem uninterested in spending time with you, there may be reasons beyond simple life busyness. The way you interact with them, how you handle family traditions, and even your financial decisions can all play a role in whether they enjoy your company. Here are nine possible reasons your adult grandkids don’t like you as much as you’d hope.

You Criticize Their Life Choices

Many grandparents struggle to accept that their grandkids are adults who make their own decisions, even when those choices are different from what they would have chosen. Whether it is career paths, relationships, or parenting styles, constant criticism makes younger generations feel judged rather than supported.

Even well-meaning advice can come across as disapproval if it is offered too often or too bluntly. Adult grandchildren want to be respected as independent people, and if every conversation feels like a lecture, they will start avoiding those conversations altogether.

You Expect Visits and Calls but Don’t Make an Effort Yourself

Many grandparents complain that their grandkids never call or visit, but relationships go both ways. If you are waiting for them to always make the first move, they may assume you are not that interested in keeping a strong connection.

With technology making communication easier than ever, reaching out through a phone call, text, or video chat is a simple way to show that you care. If you are only reaching out when you need something or when it is convenient for you, your grandkids may feel that the relationship is one-sided.

You Guilt-Trip Them Instead of Enjoying Time Together

Nothing drives people away faster than guilt-tripping. Saying things like “I guess you’re too busy for your grandmother now” or “You never make time for me anymore” may be meant to express disappointment, but it often backfires.

Instead of making them feel closer to you, these comments create pressure and resentment. Adult grandchildren have their own lives, responsibilities, and families, and when every interaction feels like an obligation rather than an enjoyable experience, they will start avoiding visits altogether.

You Treat Them Like Kids Instead of Adults

Many grandparents have a hard time adjusting to the fact that their little grandkids are now grown-ups with their own opinions, responsibilities, and lives. Talking down to them, dismissing their experiences, or failing to take their problems seriously can make them feel disrespected.

Conversations should reflect that they are adults, not children who need guidance at every turn. Asking about their careers, interests, and goals rather than treating them as if they are still teenagers can help strengthen the relationship.

You Are Stubborn About Changing Traditions

Family traditions are meaningful, but they should not be rigid. As families grow and change, holidays, gatherings, and expectations should evolve too. Grandkids who feel forced into outdated traditions that do not fit their schedules or lifestyles may start resenting family events.

If you insist that things must always be done the way they were when they were kids, they may feel like their needs and boundaries are being ignored. Being open to change and allowing traditions to evolve with the family can help keep everyone feeling included rather than pressured.

You Favor Some Grandkids Over Others

Nothing causes tension faster than favoritism, whether intentional or not. If one grandchild gets more attention, more praise, or more gifts than the others, it does not go unnoticed. Even subtle favoritism, like spending more time with certain grandkids or remembering details about one but not another, can cause lasting resentment.

Treating all grandchildren equally and making an effort to build relationships with each of them as individuals can prevent unnecessary tension. No one wants to feel like they are competing for their grandparent’s approval.

You Talk Too Much About “Your Time” and Dismiss Theirs

Grandparents often reminisce about the past, but constantly comparing today’s world to “how things used to be” can make conversations frustrating for younger generations. Saying things like “Back in my day, we worked harder” or “People were tougher when I was young” can come across as dismissive of their struggles.

Adult grandchildren want to feel like their experiences are valid. Instead of constantly talking about how different things were in the past, listening and engaging with their current experiences can make them feel respected.

You Make Money a Source of Power or Resentment

Young man and a mature woman holding a jar with money isolated on white background
Image Source: 123rf.com

Money is one of the most common sources of family tension. Some grandparents hold money over their grandkids as a way to control them, offering financial help with strings attached or making them feel guilty for needing assistance. Others constantly bring up money struggles, making it clear they expect financial help in return for past generosity.

Healthy family relationships should not be based on financial expectations. If money has become a point of tension in your relationships, setting boundaries and ensuring that financial discussions are handled with mutual respect can prevent unnecessary resentment.

You Do Not Show Genuine Interest in Their Lives

Many adult grandchildren feel that their grandparents do not really know them as individuals. If conversations are always centered around the past, surface-level questions, or family gossip, they may not feel a deep connection.

Taking the time to learn about their interests, careers, and aspirations can go a long way. Showing up for their big moments, whether it is a graduation, a promotion, or a personal milestone, makes them feel valued beyond just being part of the family.

Building a Better Relationship with Your Adult Grandkids

Strong relationships require effort from both sides. If your adult grandchildren seem distant, taking a step back to evaluate how you interact with them can be helpful. Simple changes, like respecting their independence, avoiding guilt trips, and engaging in meaningful conversations, can make a big difference in keeping family connections strong.

Have you noticed a shift in your relationship with your adult grandkids? What has helped keep your bond strong? Share your thoughts in the comments below.

Read More:

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Bank of Mom and Dad: How You’re Risking Your Retirement For Your Adult Children

Latrice Perez

Latrice is a dedicated professional with a rich background in social work, complemented by an Associate Degree in the field. Her journey has been uniquely shaped by the rewarding experience of being a stay-at-home mom to her two children, aged 13 and 5. This role has not only been a testament to her commitment to family but has also provided her with invaluable life lessons and insights.

As a mother, Latrice has embraced the opportunity to educate her children on essential life skills, with a special focus on financial literacy, the nuances of life, and the importance of inner peace.

Filed Under: relationships Tagged With: adult grandchildren, family communication, family dynamics, family relationships, financial tension in families, grandparent advice, grandparenting mistakes, intergenerational conflict, keeping family bonds, respecting boundaries

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