by Karen Rowell
Every parent has concerns about what will happen to minor children in the event of serious illness or death of the parent, but when the situation is further complicated by single parenthood or a blended family the concern can often become much greater. Proper estate planning can help alleviate some of those concerns.
Something else to consider is who will have the authority to act in the event of an emergency, or severe illness or injury. For parents, this is especially important so that there are no disruptions in the managing of your finances (and the care of your children), and so that it is clear who will make medical decisions for you when you are unable to do so for yourself, which can alleviate stress and conflict in such situations.
Any child under the age of eighteen who receives an inheritance will require a guardian of their estate (appointed by the Court), custodian or trustee to handle their property. Whether you have made advance arrangements affects this process greatly. The following is a list of important aspects of estate planning pertaining to minor children.
- Court involvement can be avoided by making sure that if something happens to you the assets left for the benefit of your child will be held in trust for them by a trustee whom you have chosen, instead of leaving it open to the court to choose a guardian.
- The terms of the trust can be written to suit your situation and the trustee can be instructed as to how to use the funds.
- If you don’t wish for assets to fall under the control of your child’s other parent it is important to do this planning, as a parent is often considered for guardianship of the estate when assets are left outright to a minor.
- If you have remarried, it is important to know that a new spouse has rights which may conflict with your desire to leave your assets to your child. Certain trust provisions can allow for the support of a spouse, if desired, while still preserving assets for your child.
- Certain assets such as life insurance policies, 401k plans and IRAs do not pass according to the terms of your Will, but instead have their own beneficiary designation forms. It is essential to properly direct these assets to the trust for your child, or to their intended beneficiary.
- It is also possible to nominate a guardian (for legal custody) of your child within your Last Will and Testament if your situation is such that the surviving parent would not be appropriate or predeceases you. The nomination will serve as evidence of your intent in any custody proceedings following your death.
If you would like to discuss your matter, please do not hesitate to contact us:
- Karen L. Rowell, Associate