I’m always amazed at grandparents who are unwilling to leave large sums of money to their own children because they weren’t trained to manage it well, but they will leave significant sums to grandchildren who can’t even talk or walk yet.

These grandchildren haven’t been trained in spiritual and social capital, let alone financial stewardship.

For the most part, I recommend that grandparents not give large cash gifts or assets to their grandchildren either outright or in trust. Instead, this money should go to their adult children (the grandchildren’s parents). Even though this recommendation may be inconsistent with sophisticated estate-tax planning techniques, such as income shifting and generation skipping, a trust can do more harm than good to grandchildren. Since their parents don’t have control over the trust’s ultimate distribution, the grandchildren could develop a slothful attitude throughout their lives as they wait for the trust funds to be distributed.