Estate planning for parents of minor children
Estate planning is not just for the wealthy, and it is not just for the elderly. Parents of young children need to plan for the care of their children if both parents should pass away while the children are still minors.
1- Planning for the financial care of your minor children.
Without a Will: If a parent dies without a Will, state law provides for a portion of the parent’s property to pass to their surviving children at the parent’s death. If property is inherited outright by minor children, a judge would appoint a responsible person, the Guardian of the estate, to care for the inherited property. A court-supervised guardianship can be expensive and burdensome and requires annual reports to the court of all expenditures. Another downside: the assets in the guardianship become the property of the minor when the child reaches age 18.
With a Will: The parent can set up a trust under their Will and name the trustee to manage the assets and distribute it for the minor’s benefit. They can provide for assets to remain in trust until the child reaches an age where he or she has the maturity to manage it responsibly.
2- Designating who will raise your minor children until they are adults.
Without a Will: A Judge will appoint a Guardian of the person to raise the children. The Judge will appoint someone the Judge decides is appropriate.
With a Will: Parents can nominate the person they would trust to raise their children by naming “Guardians of the person” in their Wills. Their choice must be approved by a Judge, but the parent’s choice carries great weight. This is the person who will raise the children if both parents pass away while the children are minors.
3- Designating who will care for your children if you are living but unavailable.
Without this designation: There can be uncertainty, delay and possible involvement of governmental authorities concerning who can make decisions for your child’s care in your absence.
With this designation: A document called a “durable power of attorney for care of a minor child” is a written designation of authority to a responsible adult who you have chosen to provide temporary care for your minor children while you are out of town or unavailable for other reasons. This document could be needed when your minor children require medical care when you are unavailable.
If you are the parent of a minor child, don’t delay in having this important work done.