For parents of minor children, the estate planning process involves a few more considerations than it does for parents of adults and individuals who do not have children. Because a minor cannot access and use financial assets, parents of minors must designate trustees to manage the assets their children inherit until they turn 18 or provide detailed instructions for their children’s guardians, all of which require court oversight. Determining who will step into the parental role in the event of one’s death is also an important part of the estate planning process because a child cannot support him- or herself or make critical decisions about healthcare.
Planning for Your Children’s Care
Parents of minor children should create guardianships for their minor children in their estate plans. By doing this, you can designate a specific relative or friend to become your children’s legal guardian in the event of your death. You can also specify different guardians for each of your children if you feel this is appropriate.
The court will uphold your designation unless it determines there is a good reason not to uphold it, such as the named guardian’s criminal record or incapacitation. If you do not name a guardian for your children in your will, the court can appoint a guardian if necessary.
Putting Assets into a Trust and Naming a Trustee
Because a minor cannot make financial decisions for him- or herself, parents need to carefully consider how best to leave their assets to their minor children. Without a will in place, the children inherit their parents’ assets, but cannot access them until
they become adults. You can include instructions for your children’s guardian to disburse money to them, but this would require court approval.
Another way to protect your assets for your children is to place them in a trust. With a trust, a trustee is named to manage and invest the money within the trust, then distribute it to the children according to the parents’ instructions.
Other Options for Leaving Assets to Your Children
A trust is not the only way to leave assets to a minor child. You can create a custodial account, which grants your child full access to the funds when he or she turns 18. Until your child reaches adulthood, the custodian you name to the account manages it.
The court does not get involved with small custodial accounts, but often does step in when the amount in this type of account is $10,000 or more. The court also takes this action when parents and other relatives leave substantial assets to minors to ensure that the child’s rights and interests are protected when he or she cannot yet make decisions about these assets.
Work with an Experienced La Crosse Estate Planning Lawyer
Your estate plans will likely change many times throughout your life as your personal and family circumstances change. Contact our team of experienced estate planning lawyers at Moen Sheehan Meyer, Ltd. today to set up your initial consultation in our office so we can take a better look at your current needs and lifestyle to direct you toward an appropriate estate plan.