After handling many hundreds of Trust and Will contest cases, we can tell you that disinheriting a child is not about the money. Well it is about keeping money from them, but the child sees it as so much more. Distrust, betrayal, danger, a lack of love or approval; these are just some of the emotions that disinherited children attach to the act of being disinherited.
In response, many disinherited children will fight. They will contest the Trust or Will and attempt to reinstate their “rightful” gift from the estate. So how do you address these emotional concerns when you want to disinherit a child? There may be no good answer, but there are a few strategies you can use to lessen a chance of a Trust or Will contest lawsuit from being filed after you are gone.
Consideration Number One: Are you sure this is the right step?
There are different ways in which to structure a child’s gift that are not as severe as disinheritance. For example, if you have a child who you think is irresponsible with money, you can create a Trust for that child with either a professional Trustee or a Trust company acting as manager. This allows the child to receive income and principal from his Trust to the extent he needs it for health, maintenance, or support, but it prevents the child from squandering the money. After the child’s death, the money can then be distributed to your grandchildren, to your other children, to charity, or wherever you want it to go.
By creating a Trust for a child you can split the difference between complete disinheritance and given the child an outright gift of money. You can also include a no-contest clause in your Trust that would disinherit the child if he fights the Trust creation. This is just one example of the flexibility Trust planning gives you when dealing with gifts to children. There are many others you can use. The point is to fully learn your options and then choose the one that works best for you. Sometimes disinheritance is an extreme solution to a much smaller problem. If you can avoid disinheriting a child, it is always best to do so.
Consideration Number Two: Consider a smaller gift, plus a no-contest clause.
If you give a child nothing, then there is no incentive for that child to refrain from contesting your Will or Trust. But if you give the child a meaningful gift, one he or she would not like to lose, then you can also include a no-contest clause. The no-contest clause states that any beneficiary who files a Trust or Will contest in Court will be disinherited and receiving nothing from the estate. By providing a meaningful gift to a child, and then including a no-contest clause, you are creating an incentive against contesting the Trust or Will.
For example, if you have an estate worth $3 million, and one child was going to inherit $1 million from you, but you disinherit that child and give them nothing, then the child has an incentive to sue. There is no reason not to contest the Trust or Will and try to get the $1 million back. If, however, you gift that child a gift of $250,000 rather than a million, then the child has something to lose. Will the child risk losing $250,000 to try to get $1 million? The gift of $250,000 makes the child’s decision whether to contest much harder than a gift of zero.
The amount of the gift necessary to create the proper incentive not to sue will vary depending on the size of the estate and the circumstances of the child. But consider this option as an alternative to complete disinheritance.
Consideration Number Three: So you still want to give the brat nothing?
If you still prefer giving a child nothing, then you have to anticipate a Trust or Will contest being filed after you die. That means you need to draft the Trust or Will in a way to protect it from a future contest claim. If there are any questions as to your capacity (i.e., if you have been diagnosed with dementia), then you need to document your mental state at the time of signing your Trust or Will. Use a doctor’s opinion, have a second lawyer do a certificate of independent review, figure out any way you can to document the proper creation of your Trust or Will.
Furthermore, it does not hurt to include some language explaining why you are disinheriting the child. This should be written in your own words, if possible. It can be included in the Trust, or as a separate document referenced in the Trust document. Try to avoid a bunch of legalese in explaining your reasons because it will that would sound contrived and fake. The more you can express yourself in your own words the better.
In sum, remember that the act of disinheriting a child can be a powerful, and painful, message. It may be more powerful and painful than you even believed it to be. So consider the act carefully. Think about alternative to disinheritance. Talk to the disinherited child in advance, if you are able to do so. And then consider NOT disinheriting the child—or at least providing a alternate means to disinheritance by reducing the child’s share or the child’s access to the money. Your estate is more likely to be protected from attack after you die, if you avoid a complete disinheritance of your child or children.