Personal Finance

I've got a $4.5 million net worth and I'm considering leaving my kids nothing - is this a stupid idea?

Joey Frenette

Published: January 23, 2025 5:28 am

Leaving exorbitant amounts of money to children can have a detrimental impact on their career and life decisions. Indeed, even if a parent doesn’t tell their children what to expect in the way of inheritance, they’ll probably already know the magnitude of what they could receive at some point down the line. And in response, some children will never live up to their full potential. Whether that’s lacking work ethic because something will simply be given to them in the future or something else, it’s not hard to imagine that waiting on a small fortune gives the wrong incentives.

Indeed, as a parent, it’s great to give their children a bit of a headstart in life. At the same time, too much of a good thing (money) can have unintended consequences. Indeed, if you’ve been spoiled growing up, you may have no idea how difficult it is to make money. They’re called “hard-earned” dollars for a reason.

Similarly, if one has their financials taken care of, why even bother learning how to budget, save, invest, and all the sort? If you’re raised as a spender, it can be tough to switch gears, especially if there is no incentive to do so.

Some parents with millions in the bank, like this Reddit poster, may even consider leaving their children nothing so that they make their own money and not have to rely on someone else as they enter adulthood.

When it comes to inheritance, it does not have to be all-or-nothing!

Indeed, this is quite an extreme. Leaving children with nothing is a personal choice that has no right or wrong answers. However, I do think that there’s no need to resort to extremes, especially earlier on. Personally, I think there are better ways to communicate to one’s children that they should not sit around waiting for a fat inheritance. 

Given how personal this personal finance topic is, I’d strongly encourage one to visit a financial planner and perhaps a family therapist to get a better sense of the options they can take regarding leaving money behind for the children. If the parent doesn’t want to leave millions to their children, they can perhaps leave a smaller, “fair” sum they deem reasonable. Indeed, whether that entails “ramping up” your own retirement lifestyle and expenditures or being generous to other causes remains the big question for the individual.

Additionally, one can stay quiet about the exact figures one will leave behind while fostering financial independence by not drip-feeding them with cash every so often. Sure, you can set a safety net for them should they fall. But in terms of discretionary and luxury expenses, they could do more harm than good for some individuals.

The bottom line

In short, I think there’s no need to be too extreme in one way or the other. It’s not about leaving all or nothing. Receiving nothing or next to nothing probably wouldn’t sit well with the children. It could cause resentment to build, and family relations could suffer as a consequence.

Perhaps one can donate to charitable causes with one portion while allocating another to be left behind for inheritance. I believe that finding that perfect balance should be the priority of this individual.

Either way, a financial planner who truly understands the individual is a must-have, at least in my opinion, given inheritance and trust planning can be a rather complex topic given one’s range of values.