15 Ways to Guarantee Your Money Goes to Your Kids After You Die

If you passed away today, would your family be taken care of?
Updated May 8, 2024
Fact checked
calculating domestic expenses

We receive compensation from the products and services mentioned in this story, but the opinions are the author's own. Compensation may impact where offers appear. We have not included all available products or offers. Learn more about how we make money and our editorial policies.

Many people assume that if they passed away, their assets would transfer to their children without much problem. However, it can be a long, complicated process.

As you build your wealth, it's essential to start planning your estate. In fact, everyone should at least have a will, no matter how much money you have, especially if you have dependents. 

Estate planning can also help ensure your heirs will see more of their inheritance rather than getting eaten up by taxes. Here are 15 ways to ensure your kids actually get your money after you die.

If you’re over 50, take advantage of massive discounts and financial resources

Over 50? Join AARP today — because if you’re not a member you could be missing out on huge perks. When you start your membership today, you can get discounts on things like travel, meal deliveries, eyeglasses, prescriptions that aren’t covered by insurance and more.

How to become a member today:

  • Go here, select your free gift, and click “Join Today”
  • Create your account (important!) by answering a few simple questions
  • Start enjoying your discounts and perks!

Important: Start your membership by creating an account here and filling in all of the information (Do not skip this step!) Doing so will allow you to take up 25% off your AARP membership, making it just $12 per year with auto-renewal.

Become an AARP member now

Transfer assets while you’re still alive

brizmaker/Adobe couple reviewing bills at home kitchen

Why wait until death? Consider handing down assets to your heirs while you’re still alive. You can gift up to $17,000 per year per child completely tax-free as of 2023, according to the IRS.

This way, you can avoid estate taxes and see the difference your money makes in the lives of your loved ones. If you take this route, you might advise your children to save money in a high-yield savings account.

Hire an attorney

fizkes/Adobe signature on legal documents

Estate planning can be challenging, especially if illiquid assets are involved, such as a business or family farm.

A board-certified estate planning attorney can help you prepare necessary legal documents and minimize estate taxes and probate costs.

Knowing that your estate plan is well-crafted and legally sound provides peace of mind for both you and your loved ones.

Create a will

Starmarpro/Adobe senior woman sit with laptop

A will, formerly known as a "last will and testament," is a critical part of an estate plan.

It's a legal document that outlines how you want your assets distributed and who should care for your minor children if you pass away. 

If you don't have a will, a probate judge will decide the division of your estate, and it might not be distributed as you would have wanted.

Resolve $10,000 or more of your debt

Credit card debt is suffocating. It constantly weighs on your mind and controls every choice you make. You can end up emotionally and even physically drained from it. And even though you make regular payments, it feels like you can never make any progress because of the interest.

National Debt Relief could help you resolve your credit card debt with an affordable plan that works for you. Just tell them your situation, then find out your debt relief options.1

How to get National Debt Relief to help you resolve your debt: Sign up for a free debt assessment here. (Do not skip this step!) By signing up for a free assessment, National Debt Relief can assist you in settling your debt, but only if you schedule the assessment.

Try it

Name an executor

Ming/Adobe calculating the raising cost of bills

In your will, you can name an executor to oversee the management of your estate, pay off debts, and distribute assets to your heirs. They may also need to handle legal and administrative tasks required to settle your estate.

You should name someone who is organized and can handle the role's responsibilities. It's also crucial that you trust them completely to act in the best interests of your estate.

Assign a durable power of attorney

olga_demina/Adobe pensioner saving pension for utility bills

A power of attorney assigns an agent or attorney-in-fact to make financial and medical decisions on your behalf. A durable power of attorney remains in effect even if you're incapacitated and can't manage your own affairs.

Without one, if you have a physical or mental condition and can no longer manage your finances, these critical decisions may be left up to the state.

Name beneficiaries

Lumos sp/Adobe grandchildren saving money on piggybank

Probate can be a long, costly process. 

Luckily, you can often bypass it entirely by naming beneficiaries for retirement accounts, life insurance policies, and some bank accounts. When you pass away, these accounts transfer directly to the named beneficiaries.

Many states also recognize a beneficiary deed, so your property will transfer on death.

Open a joint bank account

New Africa/Adobe senior couple consulting male insurance agent

Joint bank accounts typically have a "right of survivorship," meaning if you pass away, the account automatically transfers to the surviving account holder(s) without going through probate.

As with choosing an executor for your estate, naming a reliable person as a joint account holder is important. All joint account holders have equal ownership and control over the money, which may lead to family disputes.

Establish a trust

fizkes/Adobe An older woman looking at a bill

A trust is an excellent way to keep assets out of probate court and avoid estate taxes.

If you're worried your children may not use your money responsibly, you can set conditions, such as specifying that the trustee must use it for education, a wedding, or a house.

Irrevocable trusts typically offer the most tax advantages, but once you transfer money to the trust, you can't get it back.

Designate a guardian for minors

Syda Productions/Adobe Senior woman with paperwork

Designating a guardian for minors in your estate plan is an essential step to ensuring your children get the care and financial support they need if something happens to you.

A guardian is responsible for the well-being of your children if you die or are incapacitated. Your estate plan can also specify how your guardian should manage your assets for your children.

Earn cash back on everyday purchases with this rare account

Want to earn cash back on your everyday purchases without using a credit card? With the Discover®️ Cashback Debit Checking account (member FDIC), you can earn 1% cash back on up to $3,000 in debit card purchases each month!2

With no credit check to apply and no monthly fees to worry about, you can earn nearly passive income on purchases you’re making anyway — up to an extra $360 a year!

This rare checking account has other great perks too, like access to your paycheck up to 2 days early with Early Pay, no minimum deposit or monthly balance requirements, over 60K fee-free ATMs, and the ability to add cash to your account at Walmart stores nationwide.

Don’t leave money on the table — it only takes minutes to apply and it won’t impact your credit score.

Apply for a Discover Cashback Checking account today

Write a letter of intent

rh2010/Adobe senior couple calculating some bills

A letter of intent is not considered a legal document. It’s simply a letter written to your beneficiaries or executor. However, it may help a probate judge understand your preferences for your estate.

In a letter of intent, you can convey your thoughts and intentions about your estate plan in a more personal way. You can also specify funeral directions and how you'd like your assets used.

Pay off debt

ViDi Studio/Adobe man holds credit bank card

When you pass away with outstanding debt, creditors have a legal right to seek repayment from your estate before any assets are passed on to your heirs.

Debts from personal loans, credit cards, mortgages, and medical bills can reduce the amount of your heirs’ inheritance. In some cases, the estate executor may need to sell assets that you intended to leave to your loved ones to settle debt.

Get a life insurance policy

Юлия Завалишина/Adobe senior couple managing finances

When you sign up for life insurance, you pay regular premiums for the promise that the insurance company will pay out the death benefit to your beneficiaries when you die.

A life insurance policy is a safety net to replace the income you would have provided your family if you were still alive. It’s especially important if you have minor children.

Convert retirement accounts to Roth accounts

Jadon B/peopleimages.com/Adobe retirement with a father and son

If you have a 401(k) or traditional IRA, your heirs will need to pay income tax when they withdraw inherited funds from traditional retirement accounts.

To save money on taxes, consider converting these accounts into Roth accounts. Although you will pay income tax to convert the account, there will be no taxes when your heirs make withdrawals.

Communicate your plan to your loved ones

Oostendorp/peopleimages.com/Adobe senior couple with invoice

Once you have a plan assembled, you should discuss your intentions for your estate with your loved ones.

A simple conversation can manage people's expectations about their inheritance after your death. It ensures that your wishes are understood and may prevent hurt feelings and animosity between heirs after you're gone.

Regularly review your estate plan

Alexandra W/peopleimages.com/Adobe senior couple and financial advisor

Circumstances change, so you should regularly review your estate plan every few years to ensure it's still in line with your wishes.

As you grow your wealth, or if it decreases, it may be necessary to reassess your tax planning and wealth distribution. You should also review your estate plan after major life events, changes in health, or switching attorneys or financial advisors.

Bottom line

Yuliia/Adobe mature male with pile of dollars

Estate planning is crucial, especially as your assets increase. A solid estate plan can ensure your hard-earned money goes to the right people.

In addition to having an estate plan, you should try to get out of debt before or during retirement. Otherwise, your estate will be reduced to pay creditors.

Having a plan in place for your estate is the best way to save your friends and family time, money, and stress during their time of grief.

Choice Home Warranty Benefits

  • First month free
  • Protection for unexpected expense
  • 24/7 claims hotline
  • Network of over 15,000 technicians

Author Details

Carley Clark Carley Clark is a personal finance writer from Michigan. She graduated from Spring Arbor University with a bachelor's degree in business. After graduation, she worked in finance as a revenue auditor at a casino. Carley strives to write informative content that will help readers meet their financial goals.

Want to learn how to make an extra $200?

Get proven ways to earn extra cash from your phone, computer, & more with Extra.

You will receive emails from FinanceBuzz.com. Unsubscribe at any time. Privacy Policy

  • Vetted side hustles
  • Exclusive offers to save money daily
  • Expert tips to help manage and escape debt