Estate Planning: How to Leave Money to Your Kids – But Not Their Spouses

estate planning
Picture of Scott Hohman, CFP®, AIF®

Scott Hohman, CFP®, AIF®

It’s a blessing to be able to pass on significant assets to your children — and it’s likely one of the reasons you worked so diligently and saved so strategically throughout your lifetime. It’s natural to want to keep your wealth in the family, especially when we find ourselves living through economically uncertain times. Even though you might love your daughter-in-law or son-in-law very much, you can’t predict what the future may hold. This leads many people to wonder whether there’s a way to leave money to their children without passing any rights on to their children’s spouses. Typically, this can be done through trusts, and pre- and postnuptial agreements.

Typically, once you pass assets to your children outright, their spouses will have equal rights to those assets. When you have positive relationships with the spouses, it’s natural to feel a bit guilty about trying to avoid passing on any rights to your wealth. However, if you feel strongly about preserving your financial legacy for your children, there are ways to do so.


Setting up a trust is one of the most common ways of shielding your assets, and it’s easy to do. If you want to pass money to your children today, you can create the trust now. If you want to wait until you’re gone, a trust can be created through your will and go into effect later.

SEE ALSO: The Essentials of Estate Planning

A trust is versatile — it can receive investment assets, as well as be named the beneficiary of assets like your retirement accounts or life insurance. You can set the terms of the trust to direct exactly how much income or principal should be distributed to your children. You can even direct the trustee to pay only expenses for your children instead of distributing cash, which protects against their spouses having access to cash distributions.

Prenuptial Agreements

In the past, there has been a certain stigma to signing prenuptial agreements. However, more and more Millennials are choosing to sign prenups. Not only do prenups document and verify the assets each spouse brings into the marriage, but they also detail what happens to assets that may be inherited in the future. If you know your plans before your children get married, including the wealth you plan to pass on to them, their prenuptial agreements will ensure the money will stay with your children.

Postnuptial Agreements

So, what do you do if it’s too late to get your children to sign prenups? Postnuptial agreements allow you to accomplish the same peace of mind regarding the future distribution of your assets, but they are put in place after your children have already tied the knot. This can make for an uncomfortable conversation, and there is the potential for it to create some bad feelings within the family. Still, if you feel strongly about keeping your wealth with your children, it might be worth the risk to ensure your estate plans are carried out according to your wishes.

SEE ALSO: Six Ways to Build Wealth in Your Sixties

Final Thoughts on Passing Wealth to Your Children but Not Their Spouses

Estate planning consists of taking steps now to ensure you can control the distribution of your assets in the future. Regardless of your relationships with the spouses of your children, it’s not uncommon to want to ensure your wealth stays with your kids. As you consider your options, including those listed above, it’s wise to enlist the advice of a qualified attorney to ensure your estate documents are properly prepared to carry out your wishes.


The views expressed represent the opinion of Resolute Wealth Advisor, Inc. (RWA). The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and nonproprietary sources that have not been independently verified for accuracy or completeness. While RWA believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and the RWA’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in equity securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, or from economic or political instability in other nations. Past performance is not indicative of future results.

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