'AITA for leaving my business to my daughter? My other kids accused me of 'playing favorites.'' UPDATED

"AITA for leaving entirety of my business to my daughter and causing my other kids to accuse me of playing favorites?"

When I graduated college, I got a job in tech and my gf (now wife) was pregnant with my first child. I wanted to open my own business but the timing was shitty and way too much risk that I could not afford. So I accepted the job in tech. I never left the field as it paid well and let me do what's best for my family.

I had 2 more kids (Z 32F, Y 31M, X 30F), married my gf who wanted to be a SAHM and started saving for their college. I sort of accepted long ago that I would never be able to go into business. My wife wanted to save some more for the kids for after college.

All of my kids got full ride scholarship to college and I told them that their college fund will be given to them when they graduate. All of a sudden I didn't have to work in a field I was not passionate about anymore.

When X graduated, I really wanted to start my business. I did not have much money sitting idle except our emergency and retirement fund. I was reluctant to touch them. But I needed capital. So, I asked my kids if I could use their college fund.

I warned them very clearly that this might backfire massively. I could end up losing all the money and I wouldn't be able to give them ANY money. Z had already brought a house. Y did not want to take the risk. X accepted. I wouldn't have held it against them at all.

I slowly started my business (easy because I was always passionate and continued to learn about it over the years, my tech experience has elevated my business model). This business was a hit around the one year mark and it continued to grow.

The company grew exponentially when the pandemic hit. My business is now worth over 30M compared to the 500k it was started with. Recently, we acquired a new big project which would definitely make the company much bigger in the upcoming years (maybe x2 or even x3 the profits).

When we had a dinner with all the kids and their families for my daughter's 30th birthday. I told her that this success belongs to her too as her belief in me was what started it all. I said that it was her company as much as it was mine.

After dinner, Z asked me what I meant and I told her about my current will. My wife would get 2 houses (one we are living in and a vacation house which would give her a sizable monthly income). My personal assets and money will go 50% to my wife and the other 50% will be split equally among the 3, but the company would go to X and only her.

X and her husband are business majors and currently runs their own business, which is also a bonus. This has created quite the drama in my family. From my point of view, she incurred all th risks, so she must reap all the benefits. However, my wife and my other kids disagree and everyone are fighting now.

Z and Y pointing out that I said I wouldn't hold it against them but that's what I am doing. My wife thinks the kids are right and it looks like I am playing favorites. X has just said that it was my decision and she would accept whatever that turns out to be. AITA?

What do you think? AITA? This is what top commenters had to say:

[deleted] said:

NTA. You’re other two kids are only seeing the dollar signs right now as your business is successful.

Accomplished-Cheek59 said:

NTA. But I think you’re looking at the financial side a bit wrong. I’m an accountant, and the way I would propose splitting the business is this: 50/50 investment between you and your daughter. She put up the capital, you put up the skill and time.

So, half of the business is already hers. That represents her initial investment. The other half is yours, and you should leave THAT half to all four of your remaining dependents - wife and three children. So your wife, Z and Y get 12.5% each. X gets the 50% she already owns and 12.5%, so 62.5% total. She has the controlling majority and everyone has been allocated the business ‘fairly’.

Then sort out transferring 50% ownership to her, now. Therefore, it’s not part of an inheritance, but a return of her investment. The remaining 50% is the inheritance. Have a contract drafted up agreeing that she is a silent partner until your death so there are no surprises.

This is the fairest way, and will avoid a large chunk of inheritance tax and legal wrangling. All of your children ‘inherit’ part of your success, and your daughter gets recognition for investing in it.

jacquilynne said:

This should never have been an issue because your daughter's college fund should have legally bought her equity in the business in the first place.

And MrNjord said:

NTA. Z and Y sound greedy and entitled. You gave everyone the opportunity to invest and told them about the risk. Only X was willing to take it. Now your other kids want the reward without ever putting in anything. Make sure to sit down with a very good lawyer to make sure your will is as ironclad as possible.

He later shared this update:

I called a family meeting over Skype. All 5 of us were there in the call. First, I apologised for how the news came out. I told that I had wrongly assumed that everyone would be okay with this. My children aren't greedy or entitled. They are responsible and kind.

They need not have studied as hard as they did as they could have easily used the money I had given them. Instead, they worked hard and got scholarships. Even after college they worked hard and got good jobs and made good investments.

If they hadn't, I would have continued my previous job to save more money for their future or to help them out. In a way, they all helped me do what I wanted to do.

I told them that even now I can give them each 1/3 Rd of the company and give X whatever she gave me with 25% interest separately. I asked them to a answer me honestly one question: If the business had gone belly up, would they have split their money and given a share to X or would they have told her to accept that her investment was a risk.

My children are not liars. They admitted that even though they are now well settled, back then they might not have given X any from their share. In the end, I told them that they can decide what I need to do and I would do that. Both of them said that X deserves it and she would make the most out of the business in the future.

They also admitted that they felt guilty for not helping me and it felt like I was pointing that out. I again told them that they all helped me in this and that was not what I was doing. I apologised for the abruptness but told them that I just wanted to show some appreciation towards X, not make them feel bad.

I also reminded them that I am not going anywhere anytime soon but I was glad this was over now instead of them thinking that I was angry or something after I was gone and I couldn't have clarified any of this to them. All is well that ends well, I suppose.