If you are a parent with a minor child, it is critically important that you do some basic estate planning to provide for your children if something should happen to you. Your family, and ultimately the Court, needs to know the answers to the following questions:
Who do you want to raise your children if you are gone?
This is the most critical question that any parent might have to face – and we all know that making a clear, wise decision about who will raise your kids if you are unable to raise them yourself, can significantly shape their lives. Please, take time to pray about it, think about it, discuss it with your spouse, discuss it with potential guardians, discuss it with your attorney – and make sure that you feel at peace with your decision. When you have settled on a thoughtful decision about who will be the guardian of your children, you will sleep much better at night.
Making this decision and incorporating it into your estate plan will not only be a relief to you and your spouse, but it will also avoid or reduce family conflict. In a custody fight, no one wins, and the children lose. More than likely the bad blood that occurs in such a dispute will linger and your children will never build a healthy relationship with the losing set of grandparents.
Who do you want to manage the assets from your estate and life insurance policies on behalf of your children?
If you have assets or life insurance policies and you do no estate planning, your children will still receive the assets from your estate. However, the assets won’t be overseen by your choice of a trusted Trustee, but rather, will be overseen by the Clerk of Court. Every time that your children need a distribution from those funds, someone will have to petition the Court for the money. This can be costly and can cause needless delays in taking care of your children’s needs. A better solution is to create a springing trust and name a trusted friend or family member to be the Trustee to manage and oversee your child’s money until they reach an age that you feel like they are mature enough to handle the money well.
Moreover, by naming a Trustee in your Estate Planning Documents for your children’s money, not only have you protected them against delay, hassle and expense, but you have also reinforced your selection of guardian if you name the same person as guardian and trustee in your Estate Plan. This is strong evidence to the Courts that you have carefully planned for your children’s well being and that they should ratify your decision of who will care for your kids. Courts are very hesitant to name a different person as guardian than the trustee that you have appointed to be in charge of the financial well being of your children. Courts recognize that this sort of split arrangement can cause constant conflicts and messes in raising your children – a problem that they wish to avoid.
At what age do you want your children to have total access and control of their portion of their assets from your estate and life insurance policies?
If you have failed to provide for a trustee for your children’s finances and the Clerk of Court is overseeing their estate, another significant problem can arise. The Clerk will lose jurisdiction over your children’s money and they will be entitled to receive the entire amount of their share of your estate when they turn 18. Because, in the eyes of the law, they are now adults. Think about that scenario. Very few parents think it would be wise to give a large, lump sum of money to their 18 year-old child. That is a recipe for financial disaster.
If you have minor children, it is vitally important that you have an estate plan in place to protect them. To talk to one of our attorneys about preparing a plan, schedule a free consultation using the blue “Contact” button at the right of the screen, email us at firstname.lastname@example.org, or call us at (919) 348-9211.