Over the years of working with clients, I have consistently found that most choose to leave all or a substantial portion of their assets to their children. We all want our children to succeed in life, but is leaving them a large sum of money or possessions beneficial to them?
This post will look at how assets were dealt with upon death in Biblical times, what principles we can glean from them and an alternative to consider as you establish or reevaluate your estate plan.
What’s the Concern?
According to a Money Magazine article, 70% of wealthy families lose their wealth by the 2nd generation and 90% by the 3rd generation. Not encouraging statistics.
Inheriting a large sum of money can cause unintended side effects in the next generation. An example of this is the Ford family. Henry Ford founded Ford Motor Company, revolutionized manufacturing and made a tremendous amount of money for the family. Sadly, future generations of the Ford family lacked an incentive to live up to their potential because of their wealth. Today the company’s day to day operations are not run by the family.
Another example are the so called Trust fund babies. Over the years, many wealthy families have left large sums in Trusts for the next generation. The expected wealth took away the incentive for the children to work, causing them to wait out the clock until they were old enough to receive their inheritance.
It is interesting that many wealthy non-Christian families may be more aware than Christians of the negative impacts of leaving wealth to their children. This has led many to consider options like The Giving Pledge where they commit to giving away the bulk of their assets to charity.
As Christians, the issue of a large inheritance is even more stark, as it not only takes away the incentive from working and providing for our families, but can also lead us to be less reliant upon the Lord.
The more money one has, the easier it is to put our faith and hope in what money provides rather than Jesus. Oftentimes, it is very subtle, but this change of focus, has a tremendous impact on our lives.
What the Bible Says
When the Bible was written, the economy was primarily an agricultural economy. Land was the way to provide for your family, and it was passed down through the family to provide for future generations.
However, there were times that land needed to be sold to repay a debt etc, and God’s plan was for that to be temporary. Leviticus 25:23-34 says “The land shall not be sold in perpetuity, for the land is mine. For you are strangers and sojourners with me. And in all the country you possess, you shall allow a redemption of the land.”
God created ways for the family to ensure that debt would be repaid or revert to the original family (in the Jubilee year), providing a permanent means of support for each family (Leviticus 25:8-34).
Though Israel never followed God’s instructions, it was clear that God was providing for future generations by ensuring the land could not leave the family.
The Bible does talk about leaving an inheritance to children. Proverbs 13:22 says “A good man leaves an inheritance to his children’s children.” In the cultural context that it was written, it is clear that passing land to the children and grandchildren would enable them to survive.
However, Proverbs 20:21 also warns about inheritances: “An inheritance gained hastily in the beginning will not be blessed in the end.” Sudden wealth can potentially bring ruin to the next generation.
The Bible also lays out instructions for who is to inherit assets. Firstborn sons in Israel were given a double portion of their inheritance (Deuteronomy 21:15-17), while daughters normally only had an inheritance if they didn’t have brothers (Numbers 27:1-11).
Many people argue that it is Biblical to leave an inheritance to our children, and though the Bible does not forbid it, it does provide a warning. However, if we were to follow the Biblical pattern, our daughters would inherit nothing and the oldest son a double portion. That wouldn’t go over too well in our current culture, so…
Does It Apply Today?
There are three main differences between Biblical times and today as it pertains to this issue:
1. The economy is different – In Biblical times it was agriculturally based, meaning if you didn’t have land, you would not be able to survive or prosper. Our economy today is knowledge based, where anyone can support themselves if they acquire the necessary knowledge or skill. Education/skill training has largely replaced land as the tool to provide for our families.
2. The role of women has changed – Today, many women work outside the home and are not dependent on extended family to provide for them. Though there were exceptions (Lydia in the New Testament), most women did not work outside the home during Biblical times.
3. Multi-generational families living together aren’t as common – As children reach adulthood, most (but not all) leave home and become self-supporting. In Biblical times, families lived together to help run the family farm or business.
Much has changed from Biblical times, but the underlying principles are still applicable today.
Biblical Principles
There are several principles that we can glean from what the Bible says about leaving assets to children:
1. God Owns It All
As we covered during our stewardship discussion, this is God’s money, not ours. Though we may want to help our children, should the money be used to support God’s goals and not ours? Won’t God do a better job of providing for our children than us?
2. Don’t undermine your son-in-law
Part of the reason why daughters weren’t left an inheritance, is because their husbands were to provide for their needs. If the daughter received a large inheritance, that could undermine the son-in-law as he tried to provide for his family’s needs.
3. Don’t build bigger barns
Jesus’s Parable of the Rich Fool (Luke 12:13-21) reminds us that we need to be rich to the Lord, and not be trying to store all His blessings in bigger barns. If your children are already well off, inheriting a large sum can become a snare to them. Having less money and relying on the Lord is preferable than having more money and relying on yourself and your possessions.
4. Provide for your minor children
1 Timothy 5:8 “But if anyone does not provide for his relatives, and especially for members of his household, he has denied the faith and is worse than an unbeliever.”
If you have minor children, establishing a plan for them to be raised by godly guardians in the Lord is essential. Leaving the bulk of your money to provide for their financial needs until they reach adulthood is a wise application of this Scripture.
5. Provide the means for your children (or grandchildren) to provide for their families
Land did represent wealth in Biblical times, but more importantly, it gave the family the means to provide for one another. As we are in a knowledge based economy, providing education/skills training will enable the next generation to provide for themselves and trust the Lord for His provision.
Another Way
There is nothing unbiblical or sinful about leaving all (or the bulk) of your assets to your children. However, can your children handle new wealth and still trust in the Lord? We may think our children can handle it, but we won’t know until after they have the funds and see their decisions (for example the Prodigal Son Parable in Luke 15:11-32). Money can change people and cause them to do things they wouldn’t normally do.
Would it be better to not provide them too much of a good thing, so that they continue to rely on God for their provision?
Rather than leaving a large sum of money to adult children who may already be well off (and will just be building bigger barns or will use it in ways that dishonor the Lord), perhaps we should consider an alternative:
1. Pay for college/vocational training
As we live in a knowledge based economy, equipping our children (or grandchildren) to provide for themselves by paying for college or vocational training, can give them the tools they need for the future. Then they can grow in their faith as they see the Lord leading and providing step by step.
2. Leave a small or no financial inheritance to your children
Allowing your children to learn to trust God for provision is invaluable. When couples reflect on their walk with the Lord, many times they point to the early years when money was tight as a time that they learned to trust the Lord. Allowing children to struggle as they learn to trust the Lord is not a bad thing.
3. Donate the bulk of your assets to Christian organizations
Leaving the bulk of the Lord’s assets to organizations who will use it to pursue God’s purposes will have an impact for eternity. It allows money to serve as a tool to benefit others for Kingdom purposes.
4. Establish a spiritual inheritance for your children
In Deuteronomy 6, God instructs the nation of Israel to pass along the word of God to their children so that when they enter the Promised Land and have homes they didn’t build, they wouldn’t forget the Lord.
Focusing on leaving a spiritual inheritance, one that would remind the next generation of the Lord, will help your children (and grandchildren) rely on the Lord in times of prosperity and of need. Having deep conversations about your faith, how God has had an impact on your life and modeling Christlikeness in your life leaves a lasting impact on those around you. This inheritance will never fade, rust or be destroyed, but can point your children (and grandchildren) to the true eternal treasure that can be found in the Lord.
What Might This Look Like?
Let’s assume the value of all the assets God has entrusted to you is $500,000 when you die, and you have two adult children. Most people may leave 10% to their church ($50k) and the remainder would be divided equally between the children ($225k each). This may be a substantial amount of money for each child.
An alternative to consider, would be to leave 10% to each child ($50k each) and $400,000 to support the Lord’s work. The children would receive the blessing of a financial inheritance to help them as they move forward, but it wouldn’t be large enough to dramatically change their life. More money goes to support Kingdom focused ministries who will have an impact on eternity.
If you choose to not leave a large financial inheritance to your children, I would encourage you to explain your plan and reasoning with them. For them to understand why the bulk of funds will go to support the Lord’s work can be an invaluable teaching tool.
This may be the path less travelled, but if thought through and implemented well, can have a positive impact for future generations of your family and for eternity.
Parting Thoughts
1. Will a large financial inheritance be a blessing or a snare to my children?
2. Patrick Henry once said, “This is all the inheritance I give to my dear family. The religion of Christ will give them one which will make them rich indeed.”
3. Giving at our death is our last act of stewardship. Have you included God in your plan?
4. Abigail Van Buren (the original Dear Abby author) said “If you want your children to turn out well, spend twice as much time with them, and half as much money.” Quality time is the best gift to pass along to our children and grandchildren.
