Putting Money Aside for Grandchildren: Your Options and How a Will Can Protect It until the Right Time

If you want to leave money to grandchildren, you generally have two jobs:

1. Save or set money aside in a way that suits your budget and family (now, while you are alive).
2. Use your Will (and often a trust within it) to make sure that money is protected, goes to the right people, and is released at the right time, not automatically at 18 and not in a way that could be diverted or mishandled.

A Will can absolutely do this but the how matters, especially if you want control over timing, safeguarding, and “what if” scenarios (like divorce, debt or family changes).

The main options for saving for grandchildren (while you are alive)

There isn’t one “best” option, it depends on whether your priority is tax efficiency, control, or simplicity.

1) Junior ISA (JISA): straightforward, tax-efficient but control ends at 18

A Junior ISA can be a great way to build a pot in a grandchild’s name. Anyone can contribute but the total paid in each tax year cannot exceed £9,000 in 2025/26.

Pros

• Tax-efficient growth (no UK income tax or capital gains tax on the investments inside).
• Easy to set up and contribute to.

Watchouts

• The money legally becomes the child’s at 18. You cannot delay access beyond that.
• If your main worry is “I don’t want them to get it all at 18,” a JISA may not match your goal.

2) Bare trust accounts: flexible and simple but the child owns it (often at 18)

A bare trust can be used for saving/investing for a child, often with a parent as trustee.

Pros

• Can be simple to administer.
• Clear “this is for this child” structure.

Watchouts

• The money is treated as belonging to the child and they can typically demand it at 18 (in England & Wales).
• Less protection if your aim is staged release (e.g., 25 or 30).

3) Regular gifts from income: can be very effective (and often overlooked)

If you have surplus income, regular gifting out of income can be an inheritance tax-efficient way to support grandchildren but it needs to be done properly and evidenced.

HMRC recognises exemptions including gifts that are part of your normal expenditure out of income, plus the £3,000 annual exemption and small gifts of £250 per person per tax year (subject to conditions).

Pros

• Can be a tax-smart way to pass value during your lifetime.
• Helps grandchildren earlier, when it can make the biggest difference.

Watchouts

• Needs consistency and record-keeping.
• Not a “one-off quick fix” – it is a strategy.

4) One-off gifts: simple but consider the inheritance tax “7-year rule”

In general terms, gifts to individuals can be treated as potentially exempt transfers: if you live 7 years after making the gift, it is usually outside your estate for inheritance tax purposes (unless it is a gift into trust).

Pros

• Simple, immediate impact.

Watchouts

• Timing matters.
• Larger gifts may need thought around tax, fairness between grandchildren and how the money is managed once it’s given.

5) “I want it protected”: consider trusts as the protection mechanism (often via your Will)

If your key concern is protection and control, a trust-based approach is often where you end up especially if you want trustees to manage money and release it at the right time.

A discretionary trust, for example, can allow trustees to decide when and how beneficiaries receive funds and beneficiaries typically don’t have an automatic entitlement to the assets. This can also offer protection in scenarios like divorce or bankruptcy because the beneficiary may not “own” the trust fund outright.

How a Will protects money for grandchildren (and controls when they receive it)

This is the crucial point: a Will doesn’t just say who gets what, it can set the rules.

The most common “problem” people want to avoid

“I want to leave money to my grandchildren but I don’t want an 18-year-old to suddenly receive a large lump sum.”

That is a sensible instinct. The solution is usually not “just write their name in the Will” because a direct gift can create a fixed entitlement at a young age.

Instead, your Will can:

• place funds into a trust
• appoint trustees
• set release ages / milestones
• add protective conditions
• and include backup instructions if circumstances change

The three main ways to leave money to grandchildren in a Will

Option A: A simple cash gift to each grandchild

This is the straightforward “I leave £X to each grandchild” approach.

Best for

• Smaller gifts
• Older grandchildren
• Situations where protection isn’t a concern

Risks / limitations

• If a grandchild is under 18, the money is typically held until they’re 18 then it becomes theirs outright.
• Limited control over timing.

Option B: A trust in your Will that holds money until a chosen age (e.g., 21, 25, 30)

This is often what people mean when they say “I want it to go to the right people at the right time.”

You can design the trust to release money:

• all at 25, for example, or
• in stages (e.g., 10% at 21, 30% at 25, remainder at 30)

Why this works well

• It creates a clear “framework” for trustees.
• It gives grandchildren time to mature.
• It allows trustees to adapt to real life.

Option C: A discretionary trust (maximum flexibility and protection)

A discretionary trust can be a strong fit when you want:

• protection from poor decision-making
• the ability to support grandchildren differently (e.g., one needs help with university, another with a home deposit)
• the option to include future grandchildren not yet born

In a discretionary trust, trustees decide how and when assets are distributed among potential beneficiaries.

Good for

• Blended families
• Unequal needs between grandchildren
• Concern about divorce, addiction, debt or vulnerability
• “We want flexibility as life changes”

Trade-off

• It needs careful drafting and thoughtful trustee selection.

“Right people, right time”: the key building blocks to include in your Will

1) Choose trustees like you are choosing a steering wheel

Trustees are the people who will manage the money, make decisions, and protect your grandchildren’s interests.

Good trustees are:

• dependable
• financially sensible
• calm under pressure
• able to work well with family

Many people choose a mix of:

• a trusted family member + another independent person (depending on family dynamics)

2) Set clear release rules (not just an age)

Age is useful but real life is messy. Consider rules like:

• money can be used earlier for education, training or medical needs
• staged payments for maturity
• a cap on lump sums until a later age

This is exactly where a boutique estate planning service earns its keep: helping you define your intentions clearly enough that trustees can act confidently later without arguments.

3) Build in “what if?” scenarios

A good Will anticipates change:

• What if a grandchild dies before receiving their share?
• What if relationships change in the family?
• What if trustees can’t act?
• What if there are future grandchildren?

These are not negative questions, they are protective ones.

4) Add a Letter of Wishes (the human context)

A Letter of Wishes isn’t usually legally binding but it is often incredibly helpful. It can explain things like:

• how you would like trustees to prioritise education, housing, wellbeing
• how to handle unequal needs
• what “fair” means to you

It helps trustees act in line with your intent especially if family emotions run high later.

What to watch out for if you are trying to protect a grandchild’s inheritance

You don’t need to be alarmed - you just need to be realistic.

Common risks a protective Will can reduce

• Money arriving too young
• Family pressure (“Can I borrow some of that?”)
• Divorce (where an outright inheritance can become a point of contention)
• Debt / bankruptcy
• Unequal needs (where “equal” isn’t necessarily fair)

A well-structured Will (often with a trust) is designed to keep your gift aligned with your purpose.

When a solicitor might be appropriate

There are situations where you should strongly consider a solicitor-led approach, such as:

• complex trust structures
• overseas assets
• very high-value estates with extensive tax planning
• highly likely disputes

But many families don’t need the “premium” route, they need proper drafting and proper thinking.

That middle ground is where Soteria Estate Planning is positioned: professional, thorough, and personal not a rushed template job and not priced like you’re funding a City firm.

FAQs

Can I leave money to my grandchildren in my Will?

Yes. You can leave money directly, or (often better for protection) leave it via a trust so it is managed and released at the right time.

Can a Will stop grandchildren getting money at 18?

Yes, if the gift is structured through the right type of trust within the Will, you can delay access and/or release funds in stages.

What is the best way to protect money for grandchildren?

Commonly: appoint sensible trustees and use a trust structure that matches your goal (age-based or discretionary). If your main concern is control and protection, a trust-based Will is often the best fit.

Can I save for grandchildren while I’m alive as well?

Yes, options include Junior ISAs (with an annual contribution cap) and gifting strategies. A Junior ISA has a £9,000 limit in 2025/26.
Inheritance tax rules also include exemptions such as the £3,000 annual exemption and small gifts of £250, plus “normal expenditure out of income” in the right circumstances.

A gentle next step

If you’re thinking, “I know I want to do something for the grandchildren - I’m just not sure what structure actually protects it,” that is exactly the right moment to get guidance.

A short conversation is often enough to map:

• the saving option that fits your family,
• the level of protection you want,
• and the cleanest way to build it into your Will so it goes to the right people at the right time.

Soteria Estate Planning can talk through your circumstances in easy terms and explain the best way to protect your grandchildren via your final wishes. Contact us today for your Will Writing guidance consultation.