65-year-old parent plans for inheritance and money education for two young children

A 65-year-old parent with two young children is outlining a plan to secure their financial future after retirement while also teaching their kids smart money habits. The inquiry, which focuses on leaving an inheritance and equipping the children to manage money on their own, has drawn guidance from financial advisers who say the path involves three core elements: building wealth, educating children about money, and protecting their financial future.

Zoe Brett, a financial planner at EQ Investors, says the approach should start early and be built around three building blocks. First, build wealth for the children through tax efficient accounts such as Junior Isas and Junior self‑invested personal pensions. A Junior Isa can be funded up to £9,000 per year and can hold cash or investments, with all growth free of income and capital gains tax while invested and at withdrawal. The Jsipp offers a tax relief boost, providing an additional layer of efficiency for long term growth. For Jsipps, the government adds basic rate tax relief, meaning a £2,880 contribution effectively becomes £3,600 in the account. At maturity, the Jisa can be accessed at 18, when it can be converted into an adult Isa or kept as a continuing investment. These accounts are designed to help children cover future milestones such as education, a home, or startup capital.

Brett notes that investing tends to outperform cash over the long term, making early asset accumulation especially important given the time horizon until the children reach adulthood. A long view is key, as even modest ongoing contributions can grow substantially over 10 to 15 years and beyond.

Second, educate children about money. Brett emphasizes practical, age appropriate lessons that become habits. Chores can earn pocket money, children can participate in budgeting for family purchases, and they can be shown how savings and investments work by using real accounts (while keeping appropriate safeguards). Reading and discussion are encouraged, with recommended titles spanning ages 3 to 18, such as picture books that explain money concepts and more advanced guidance for teenagers. The goal is to cultivate an understanding of delayed gratification and the power of compounding rather than focusing solely on the end result of wealth.

A second adviser, Rob Bell, founder and chartered financial planner at Finova Money, adds that the plan should also address protection and governance. He outlines a seven point framework that can help ensure a young family is supported even if a parent is no longer there.

1. Make your will a priority. A will is not only about dividing assets; it should appoint guardians for the children and specify how assets are held and inherited. A clear plan reduces uncertainty and helps guardians maintain a stable environment for the children.

2. Protect their financial future. Life insurance that provides a steady income to guardians can help cover ongoing costs, although this is more challenging if you are older or in ill health. In some cases, pensions and other sources can offer a tax efficient legacy that benefits the children directly or through a trust.

3. Consider trusts. Trusts provide a flexible way to hold life insurance or other assets, allowing professionals to manage funds for the children until they are mature enough to handle larger sums and can help shield assets from early inheritances that might not be prudent.

4. Don’t forget pensions. Review the death benefits and ensure nominated beneficiaries are up to date, so that a tax efficient legacy can pass directly to the children or into a trust for their benefit.

5. Build a nest egg for them. Junior Isas offer a disciplined way to save for education or first purchases, and even modest monthly contributions can accumulate meaningfully over a decade or more.

6. Beyond money, focus on lasting values. The advisers stress that the legacy is not only financial; shared experiences, family time, and traditions can shape how money is used and appreciated by future generations.

7. Look after yourself too. Time and health are critical gifts. Prioritizing personal wellbeing helps ensure more quality years with the children and improves the odds of passing on both wealth and wisdom.

Bell notes that implementing these measures does not require overnight execution. Start with essential items such as a will, appropriate life cover, and a review of pension beneficiaries, then build with savings and longer term arrangements like Junior Isas and trusts. For families with young dependents, getting a solid framework in place can provide financial security while also fostering prudent financial habits in children as they grow.

In addition to these practical steps, advisers highlight the importance of considering the tax and legal implications of inheritance planning. Brett points out that teaching children about money is a long term project that complements the tax efficient ways to save for their future. Bell adds that pensions can act as a tax efficient legacy, provided beneficiaries are up to date, and that guardianship and the timing of inheritance can be structured to support ongoing education and living costs, not just a lump sum.

Experts also stress that the conversation about money education should be ongoing and tailored to the child’s developmental stage. By mapping out a path that includes both savings vehicles and educational opportunities, a parent can create a financial culture that endures beyond their lifetime. The result is not only a potential inheritance but a lasting framework that helps children become capable stewards of money.

A final reminder from the advisers is that the value of time should not be underestimated. The strongest legacies often combine financial resources with meaningful time spent together, shared experiences, and practical lessons about budgeting, saving, and investing. By balancing wealth, education, and protection, this plan aims to give two young children a solid foundation for their futures, regardless of how long the parent will be around to guide them.

If readers have questions about financial planning for families, This Is Money notes that experts can respond to inquiries and outline personalized steps. A thoughtful and phased approach can help parents in similar situations safeguard both their children's present needs and their long-term financial futures.