Having and raising children is one of life’s biggest joys and challenges. Parents have myriad responsibilities, from the everyday such as feeding, clothing, medical care and nurturing, to major decisions such as schools and higher education, to the more mundane of scheduling playdates and shuttling their kids to activities.
Given the daily demands of parenthood, families put off thinking about the possibility that something might happen to prevent them from raising and supporting their children. It’s difficult to think about, yet by not planning for that possibility, parents abdicate some of the most important decisions they can make about their children’s future.
Without careful planning, if you and your spouse or partner (or you, as a single parent, with no other parent in the picture) pass or become incapacitated, the courts will decide who will raise your children and who will be responsible for their finances. There could be several family members or friends who think they are the best for these roles. Whether they agree or disagree among themselves, they will have to go to court to petition for a guardianship (“of the person,” for those who will raise the children and “of the estate,” for those who will manage their finances). They will have to pay attorneys’ fees and court costs, and will have to submit an accounting to the court every two years until the minor children are 18. They and their attorneys are entitled to payment for their services, which payment is taken out of the children’s inheritance. In addition, once the children turn 18, they get 100% of any assets left to them, with no restrictions on how they spend the money or manage the property. With some thought and discussion among themselves and the individuals they’ve chosen to carry on their legacy, parents can have a voice in raising their children after they pass or can no longer care for them. My firm prepares living trusts for young families that include guardianship and distribution provisions that ensure that parents have a say in who will raise their children and who will manage their children’s assets. They have the option of stating specific ages for when their children can access their inheritance and how assets are invested and used for the child’s benefit until they reach those ages. With clear and detailed planning documents, parents can take heart in knowing they’ve done everything now and for the future to ensure their children’s care and wellbeing.