If you're a grandparent, chances are you've thought about how to support your grandchildren—whether it's helping with education, celebrating milestones, or giving them a head start in life. For many high-net-worth families, gifting can be both emotionally meaningful and financially strategic.
As we head into summer—a season full of family time, vacations and big life moments—it's a great opportunity to revisit your approach to gifting. Here are some smart, tax-efficient ways to support your loved ones while preserving your overall wealth strategy.
1. Use the Annual Gift Tax Exclusion
One of the simplest ways to give is by using the annual gift tax exclusion. In 2025, you can gift up to $19,000 per recipient ($38,000 for married couples) without triggering any gift tax or eating into your lifetime exemption.
This strategy is especially helpful if you have several grandchildren—you can transfer a meaningful amount of wealth over time without complicated reporting or tax consequences.
2. Fund a 529 Education Savings Plan
Education is one of the most popular and impactful ways to support younger generations. Contributing to a 529 plan allows your money to grow tax-free when used for qualified education expenses.
Bonus tip: You can "superfund" a 529 plan by contributing up to five years’ worth of annual exclusion gifts in one lump sum—up to $95,000 per child ($190,000 for couples)—without triggering gift tax (as long as you don’t make additional gifts to that person for the next four years).
3. Consider Direct Payments for Tuition or Medical Expenses
Want to make an even bigger impact without using your annual exclusion? The IRS allows you to make unlimited payments directly to educational institutions or medical providers on someone’s behalf, with no gift tax implications.
This can be a great way to cover tuition, private school, or even summer programs, without reducing your annual or lifetime exemption amounts.
4. Gift Appreciated Assets (When It Makes Sense)
If you’re considering transferring stock, real estate, or other appreciated assets to family members in a lower tax bracket, you may help them benefit from lower capital gains taxes when they eventually sell the asset.
This strategy should be approached carefully, as it can affect their financial aid eligibility, tax liabilities, or overall estate planning. Be sure to work closely with your advisor and tax professional to determine if this move aligns with your broader goals.
5. Talk About the “Why” Behind the Gift
Financial gifts can have a deeper impact when they come with a message. Whether you're helping with a down payment, starting a college fund, or encouraging responsible investing, share your intentions. It’s a chance to pass on not just wealth—but values, responsibility, and legacy.
Final Thoughts
Gifting isn’t just about tax savings—it’s about shaping your legacy and empowering the next generation. With the right strategies, you can give generously, thoughtfully, and efficiently.
If you're considering a gifting plan this year—or simply want to explore the best way to support your loved ones—let’s talk. We can help you integrate gifting into your broader financial picture and ensure it supports both your family and your long-term goals.