It can be very satisfying knowing that you can pass on something for your children after you die. If you have a home and same savings it will feel good to know that they will benefit from these when you no longer need them. However, it is not easy to build up a big posy for them to inherit and so it is worth considering the points below to help.
Start Investing for them early
If you want the inheritance to be significant then you need to start investing early. Obviously the more payments you make then the more money they will get. Also, the longer the money is invested, the more time it will have to grow. If it is invested wisely then it will gain value quite significantly over the years and this could make a big difference too. If you can afford it, you should start investing for them as soon as they are born.
Seek financial advice
It is possible to research investments yourself, but it can be wise to pay a financial advisor to help you. They have expert knowledge and they may also have access to financial institutions and accounts that you may have no knowledge of or not have access to yourself. They will also be able to explain all the options to you and let you know which they feel would be the most sensible for you, considering how much and how often you can afford to invest.
Take care costs into consideration
It is worth making sure that you take into consideration any costs that you will have going into old age. It is easy to assume that your pension will cover your needs and that they will be less than they are now. However, it is possible that you will need to pay for care, either in a care home or having a carer in your home. This could be a significant expense and could make a significant difference to your quality of life.
Consider inheritance tax
Inheritance tax is something which you also need to think about. The bigger the pot of the inheritance the greater the likelihood that it will be taxed and the larger the tax amount will be. Some people choose to give their money to their children and family earlier in their lives to avoid this tax. However, this could make them liable to pay capital gains tax instead. It all depends on how the taxation system works in your country of residence. A financial advisor will also be able to help with this.
Financially educate them
It is so important to make sure that your children understand how to use money wisely. This is not something that is often taught in schools and so it can be up to parents to teach their children. Make sure they understand the importance of avoiding most types of debt, how they should consider investing and making their money earn for them and things like this. This means that when they do inherit they will make good use of the money, cresting an income for themselves rather than just frittering it away.