MANAGING YOUR CHILDREN’S INHERITANCE
July 19, 2022
Many relatively young people do not want to think about their children’s inheritance. It raises the uncomfortable question of mortality in general, and the eerie specter of one’s potential untimely death. Moreover, many young parents do not have that many assets, or think they don’t, so one might think that it is unnecessary to set out a document distributing their worldly possessions. Finally, some young parents may think it costs too much to do any kind of estate planning other than assuming one’s own parents will step in to care for young children.
In fact, there are some good ways that parents of minor children can plan for the children’s needs. One such way is to designate a trust in which the trustee will be responsible for managing your assets on behalf of your children.
You, as the parent, would be the creator of the trust in this scenario. You may see terms like “trustor,” “settlor,” or “grantor.” These all basically are fancy legal terms for the creator of the trust.
The individual that you designate as trustee is the custodian of the assets placed in the trust. The trustee will be responsible for using the assets that you left to your children in order to provide for the children’s healthcare, education, daily needs, home, etc.
As a general proposition, minor children cannot fully inherit property. When you create a trust in this manner for your minor children, you can set restrictions upon the age at which your children would fully inherit your estate. You can set other conditions as well, such as requiring the child to graduate from high school or college before they can fully inherit.
Bear in mind that if you do not include a trust like this within your estate planning, a court will have to appoint someone to manage your children’s inheritance. Additionally, any arrangement could involve the inheritance money being used to pay for expenses like tax attorneys or financial advisors.
How an Attorney Can Help
Click here to Schedule a FREE Virtual Estate Planning Session. We will guide you through the entire process and help you understand what needs to be done to ensure your loved ones are taken care of.
Here’s a very practical one. If, like many parents, you have no idea what to make for dinner many nights, just search for ideas online. There is a plethora of recipe websites with interesting ideas that will save you from having to spend money on takeout.