Children and Gifts in Wills: 5 Ways to Get Peace of Mind

When you have children, making a will becomes even more important. Here are five key ways your will can protect your children and give you peace of mind.

1. Appoint guardians

If you have children under 18, your will is the only way to legally appoint guardians - the people who would raise your children if you die while they're still young.

Think carefully about who you'd want:

• Do they share your values and parenting approach?
• Are they physically able to take on young children?
• Do they have room for your children in their home and life?
• Would your children be happy living with them?
• Have you actually asked them?

Without named guardians, the court decides who looks after your children. They'll try to make a good decision, but it might not be who you would have chosen.

2. Control when children inherit

Under English law, children can't inherit directly until they're 18. But even at 18, many young people aren't ready to handle a large inheritance responsibly.

Your will can specify that children don't receive their inheritance until they're older - 21, 25, or whatever age you choose. In the meantime, trustees manage the money and can use it for the children's benefit.

You can even set up graduated distributions - perhaps a third at 21, a third at 25, and the remainder at 30.

3. Provide for children's immediate needs

While waiting for your estate to be sorted out, your children will still need money for everyday expenses. Consider:

• Leaving cash legacies specifically for immediate needs
• Life insurance policies written in trust (so they pay out immediately, outside your estate)
• Giving trustees power to access funds quickly for urgent needs

4. Protect children from different relationships

If you have children from a previous relationship and are now with a new partner, you face a common dilemma: how do you provide for your partner while ensuring your children ultimately inherit?

Options include:

• Life interest trusts: Your partner can live in your home and receive income for their lifetime, but the capital ultimately passes to your children
• Specific legacies: Leave your children specific assets or amounts, with the rest going to your partner
• Insurance policies: Nominate different beneficiaries for different policies

5. Plan for children with special needs

If your child has disabilities or special needs, standard will provisions might not be appropriate. A straightforward inheritance could affect their benefits eligibility.

A discretionary trust can provide for your child without affecting their entitlement to means-tested benefits. The trustees can use the trust funds to improve your child's quality of life without the funds being counted as their assets.

This is a complex area - if your child has significant special needs, consider getting specialist legal advice.