5 Reasons Why You Should Spend Your Kids’ Inheritance in 2025

Thought of spending your kids' inheritance? This concept now even has a new term dubbed “SKI’ing” – spend your kids' inheritance. Below are five reasons why this is a great idea.

1. Life Is Way Too Short to Delay Having Fun

You’ve worked all your life despite the long hours, difficult bosses, obstacles to overcome, and endless deadlines. If you’ve built yourself a healthy nest egg, this is the result of your time, effort, and energy. As a 93-year-old man once told one of our advisers:

‍“I’ve been saving my whole life for a rainy day, now it’s a rainy day”‍

Just as this gentleman pointed out, now is the time to be reaping the rewards of your hard work, not sitting back on a nest egg that has taken you a lifetime to build. Think of things you’ve always wanted to do, and go and do them. This could include:

• Exotic or domestic travel
• Achieving something you always put off
• An item or experience you always wanted, or once wanted
• Spending more time with relatives, children, and grandchildren.

2. There’s a 50% Chance Your Kids Will Blow It

Research in the United States has indicated that half of all inheritances are either spent or ‘lost’ by various methods. If there’s a fifty-fifty chance your kids will just spend or lose it, you may as well enjoy it yourself first!

3. Your Children Won’t Remember “The Stuff”

Your legacy is so much more than money.

If your goal of providing an inheritance is to enrich your children’s lives, then cash might not be the best way to do it. Think about the good times in your life and you’ll find that most of your positive memories are based on experiences, not money. Consider spending their inheritance with them rather than just gifting it after you pass away. This is a great way to make memories that your children will cherish long after their inheritance has been spent.

Of course, every family is different — both in terms of what they can afford, what they value, and what brings them joy.

4. Develop Your Children’s Values

One of the most common wishes among parents worldwide is a desire to see their children make it on their own. The overwhelming majority of financially successful people are first-generation wealth builders, meaning they didn’t inherit their money but accumulated it from saving, investing, or building a business – or a combination of all those things.

A study by global powerhouse Fidelity determined 88 percent of millionaires are self-made, which is consistent with most other studies on the topic.

The values of hard work, dedication, and frugality are almost universal among financially successful people. Most people appreciate that handing such values down to your kids is very important. As such, leaving a large inheritance to your children may be more harmful than helpful. This is because like anything in life, the less we work for something the less we seem to value it. Giving your children a large inheritance can create a sense of privilege and reduce their desire to work as hard as you did.

Most of the world’s wealthy elite also realise this, and in recent years people as diverse as Warren Buffet, Michael Bloomberg, Sting, and Bill Gates have all taken steps to give away their fortunes instead of passing it to the next generation.

5. Legal Costs, Delays, and Challenges to Your Will

Winding up a deceased estate can be a costly affair, and even firms who provide wills for ‘free’ will be taking a cut from the estate. This cut can be substantial and undermines any sum you intend to leave behind.

After losing a loved one, the last thing people want to deal with is the time, paperwork, and hassle of settling an estate. Even if the deceased has an up-to-date will, there are no legal challenges, and the whole process progresses smoothly and simply, typically beneficiaries will have to wait around six weeks for probate to be granted and then another six months from there before any distribution can be made.

However, when grief and money are combined, the family dynamic can rapidly change. As the estate is wound up and lawyers or estate professionals must work with people who cannot agree or who don’t adequately communicate with each other, there can quickly be significant complications. Such complications can make this process take well over a year, and in some cases several years. (Anecdotally, it is often reported that the spouses of the children of the deceased are the most difficult during this time. Also keep in mind that no-one ever expects their own will to be contested, even though so many are).

Challenges to wills are becoming increasingly common. There are numerous criteria for this to occur, and even the implications of an unsuccessful challenge can result in higher costs, longer delays, and almost certainly ill-feeling among family members.

To avoid the issues above tainting your legacy, it’s best to spend the inheritance before lawyers become the only winners.

The Bottom Line: Spend the Inheritance

Let’s recap the five key reasons you should spend your kids' inheritance (or go “SKI’ing”), which are:

1. Life is too short to delay having fun
2. There’s a 50% chance your kids will blow it
3. Your children won’t remember the ‘stuff’
4. To develop your children’s values
5. To avoid legal costs, delays, and challenges to your will

Despite the points above, a recent report showed that among the 300,000 Australian retirees whose real spending habits were monitored, many retirees are holding money back for future years when they will never spend it. New Zealand data is harder to obtain, though we think it would be similar. For anyone who could find themselves in this position, thorough retirement planning may be of assistance, it’d be the pleasure of our advisers to assist anyone by projecting their draw-down of funds based on their current investment strategy – or a new strategy if that's appropriate. Get in touch to book a free and no obligation initial consultation.