Why leaving money to your kids can backfire

Last Valentine’s Day, listener Lucas from North Carolina wrote in about retiring early and “taking our foot off the gas.” This year, life looks very different. Lucas and his wife recently received a diagnosis for their almost two-year-old daughter that means she may never live independently. That news sent Lucas down a deep research rabbit hole involving wills, trusts, and something called a third-party special needs trust. What started as a plan for early retirement has now become a much bigger question:How do you financially protect a child who may depend on you forever? To help answer that question, Pete and the crew are joined by estate planning attorney Shawn Scott, who specializes in helping families navigate these exact situations. In this episode we discuss: What a special needs trust actually is The difference between first-party and third-party special needs trusts Why leaving money directly to a child with disabilities can create major problems Common mistakes families make with DIY estate planning When online legal tools are okay — and when you really need an attorney How grandparents and other relatives should structure gifts or inheritances Lucas’s story reminds us that estate planning isn’t just about wealth.Sometimes it’s about love, protection, and making sure your child is cared for long after you’re gone. Also: Pete attempts a North Carolinian accent (results may vary).