With Thanksgiving and Christmas just around the corner, it’s a good time to plan ahead for family emergencies. One way to protect your children is by creating a will or trust that names guardians for them in case something happens to you. Read on for more information about what estate planning moves parents should make before the holidays.
Importance of Naming Guardians
If you have minor children, you probably worry about the ways you can best provide for them. As a parent, I can certainly relate. One thing many of us worry about is what would happen to our children (worst case scenario) if something happened to us. While we cannot predict what our future holds, we can at least have a plan. By naming guardians for our minor children, we can ensure they will be cared for by the people we select if the worst occurs.
When it comes to naming guardians, there are two separate roles to consider: a guardian of the person (who physically cares for the children) and a guardian of the estate (who is responsible for managing the children’s assets). While it’s possible for one person, or couple, to be both forms of guardian at once, some parents elect to have separate physical and financial guardians for their children. It’s all a matter of personal preference.
Using a Will to Appoint Guardians
You can appoint physical and financial guardians for your children in a will. However, absent a trust, your children will inherit all remaining estate assets at the age of 18 in one lump sum. At the end of the day, the way you appoint guardians should be determined by your specific goals and circumstances. My office can help you determine how to best protect your children - in a manner that works with your budget as well.
Using a Trust to Appoint Guardians
A trust enables parents to exercise more control over their estates. For instance, you can set up trusts to distribute money in fractional allotments as your child reaches different ages or milestones. Let’s say you want to permit your child to receive ⅓ their inheritance at 18 to go to college or trade school, then another 1/3rd once they graduate, and another 1/3rd to go toward their marriage or first house. You can specify these requirements in a trust - where you can also appoint physical and financial guardians.
Likewise, you can leave explicit instructions for your child’s guardians outlining your wishes and expectations for your children (like how you want their money spent and expenses you consider nonessential).
Let’s Get Your Estate Planning in Order
With the holidays approaching, we all want to make sure we have time with friends and family. But before you start stocking up on eggnog and peppermint bark, take a few minutes to ensure your estate planning is in order. No matter how you decide to nominate guardians for your children, it’s important that you do so to ensure their protection if anything were to happen to you.
Contact my office today for a free strategy session, and we’ll discuss how you can protect your loved ones and preserve your legacy.
Make Time for Your Kids. Holidays often serve as a reminder of how important quality family time can be. This year, remember to pause during the hustle and bustle and make time for your kids. Whether it’s designating a daily “screen-free” time for the whole family or scheduling a family game night - a little quality time goes a long way toward building positive memories and traditions that last a lifetime.