When people decide to disinherit a beneficiary, the reason is often negative. Perhaps the two people have become estranged over the years, so they no longer have a relationship. Maybe a child made lifestyle decisions that the parent doesn’t approve of, so they’re cutting them out of the will. Perhaps the beneficiary has a drug addiction or frivolous spending habits, so their parent believes they’re just going to waste the inheritance.
But it doesn’t always have to be negative. There are also some positive reasons to disinherit someone. Let’s look at two examples.
Previous gifts
For one thing, parents will sometimes give their children gifts in advance. A parent who has already transferred a large amount of money, real estate or other assets to a child during their life may feel that there’s no need to include them in the estate plan. The child has essentially already received their inheritance in advance.
This can help them when they really need it, even if their parent is still alive, and it can sometimes have beneficial tax implications for the estate itself. Reducing the value of the estate can mean that more of the assets go to family members.
A lack of need
In other cases, a parent just decides that one beneficiary doesn’t really have financial needs.
For instance, maybe a parent has two children. One has always struggled to maintain a career and needs significant financial assistance. The other has a high-paying job working in the financial industry, so the parent makes the decision to disinherit one child simply because the money will be better spent assisting their sibling.
Disinheriting someone is still serious, even if the reasons are positive. It’s important to carefully consider all of your legal options.