Spending The Kids Inheritance. And Loving Every Moment Of It.

The usually loveable Stacey Solomon and Joe Swash caused discussion in the UK recently when they announced they would not be leaving their five children any whopping inheritance. They would be leaving them nada.

Instead they’d spend it all living and loving their lives into what will hopefully be a long retirement, allowing their kids the chance to make their own way in life and stand on their own two feet.

Having come from poor backgrounds and worked their way up through reality TV and soaps and singing, the couple very much feel that just handing their kids a great big wadge of cash, will do them a huge disservice in life. That somehow the promise of inheriting millions will change their personalities, and not for the better.

They’re not the first celebs to feel this way. Daniel Craig, Rachel Weisz, Sting, Elton John and Gordon Ramsay have all been reported to be making the considered decision that their children will not unduly benefit from wealth being handed down to them.

Now with celebs, I really can see the point. Their offspring are already living hugely privileged existences, with nepotism and the social stratosphere they reside in already giving them a huge leg-up when compared to their peers, or in fact to ‘ordinary’ people of the same age as them. Let’s be honest, they’re probably not going to be sofa surfing and borrowing their Grandad’s rusty Ford Focus to get to the job centre are they?

But what is a more relevant (to me anyway) trend when it comes to kids inheritance is that it’s becoming increasingly normal for parents to blow their kids inheritance meaning there’s nothing in the will left to disperse.

The trend even has it’s own name. Those parents are ‘skiers’. They go skiing. They Spend Kids Inheritance. Clever eh?

There are a variety of reasons why these parents are now skiing rather than saving. It can be an ethical or moral decision; one where the parents feel that inheritance takes society further away from meritocracy, or that it limits the child from reaching their full potential (knowing as they might that they just have to hang tight until their fifties, then when Mummy and Daddy shuffle off this mortal coil, they’ll be quids in). Skiers report that they worry about giving their offspring a financial entitlement and therefore a reduced desire to work hard and earn their own keep.

Another reason is that people are reticent to leave money and properties which would fall into the trap of inheritance tax; many feel paying taxes their whole lives is fine, but to tax their gift to their children after death, is intolerable. They’d rather spend it now.

But one reason ski’ers give, and it’s the reason which causes the most discussion… is that actually, they’re spending the kids inheritance simply because they want to. Because they’ve worked hard all their lives and they want to enjoy the fruits of their labour. They would rather visit lots of new countries on a cruise, splash out on the car of their dreams or treat themselves to the clothes and shoes and hotel stays they always thought too expensive.

There are also the people who ski into philanthropy. Meaning they’re part of the growing trend to leave their savings to a charity or good cause they hold dear. That’s one way to appease the guilt right..? It’s also one way to cause a huge stinking family bust-up when the kids find out you left their inheritance to a local cat shelter…

According to a study by SAGA, insurer of choice for the over 50’s, that age group own a whopping 70% of the country’s wealth, amassing a staggering £6.2 trillion. But the days of their adult children being able to sit back and assume it’s all coming to them, are long behind us all. In fact a separate study, this time by the Joseph Rowntree foundation, revealed that only a quarter of over 50’s actively budget in their retirement to add to their kids’ inheritance funds. It’s a similar story in the US and in Australia. Attitudes to leaving your children a financial legacy have changed.

But should the ski’ers feel guilty? While they’re sitting quaffing champagne on a beach in Mauritius, are their kids struggling to pay ever-inflating mortgage and utility bills and having to scrimp on what they can afford to spend on their own much younger children?

While most kids will say they want their parents to enjoy their retirement fully and experience lots of amazing things, I don’t doubt that there’s a niggle of worry that the inheritance they were relying on for their own retirement is dwindling… fast.

It’s important to remember though, that lots of parents will have already gifted their kids whopping chunks to help them onto the property ladder, to pay for monstrous university fees or for lavish, OTT weddings (or divorce and it’s associated legal costs in my case). Add to this the fact that raising a child merely to the age of 18, costs in the region of £200k… maybe these parents simply feel they’ve done enough? Maybe they actually feel that gifting their kids too much money is a little crass?

When I think of it from a personal point of view, skiing seems a bit of a scary prospect. Unless I inherit something from my folks I’ll be working full-time until I die myself, leaving my own kids nothing… and not because I spent it all on that aforementioned beach in Mauritius sadly. But when I look at it from the other side, I kind of hope my parents just have a grand old time and spend it all having fun, after forty-five years of working super hard for not much pay; they deserve it. I guess I can muster up the goodwill to be happy for them to adopt the YOLO approach and ski their way through my own financial safety net.

I would however draw the line at the cat shelter Mum. Don’t make me have to challenge your will please.