Every adult can benefit from having a comprehensive estate plan in place; however, for some adults estate planning takes on heightened importance. Parents with minor children, for example, have even more reason than the average person to have a well-thought-out estate plan in place for several reasons. If you are the parent of a minor child, it is in your best interest, and that of your child, to work closely with an experienced California estate planning attorney to ensure that your child(ren) is protected in your estate plan. To help you get started though, a Los Angeles estate planning lawyer at Collins Law Firm offers tips for parents with minor children.
Why Is Estate Planning Important for the Parents of a Minor Child?
As a parent, you undoubtedly make most of the decisions in your life based on what is in your child’s best interest. You also likely spend a considerable amount of time worrying about your child and thinking about how best to protect your child from anything that might harm him/her. If something were to happen to you, you would surely want your child to be financially secure and cared for by someone of your choosing. To ensure that this happens, you need to have a comprehensive estate plan in place.
Tips for Parents with Minor Children
As the parent of minor children, what can you do to ensure that they are protected and provided for in the event of your death or incapacity? The following tips may help:
- Name a Guardian. When you think about your Last Will and Testament you likely think about the distribution of your estate assets. As a parent of a minor child, however, your Will serves a more important purpose. Your minor child cannot inherit directly from your estate, so the asset distribution function your Will serves has little to do with your children. Your Will is important, however, because it is the only official opportunity you have within your estate plan to nominate a Guardian for your minor children.
- Establish a testamentary trust. Because a minor child cannot inherit directly from an estate, most parents establish a testamentary trust that is triggered by a provision in their Will in the event of their death. The trust can hold your estate assets and distribute them according to the terms you create to be used for things you have authorized while they are minors. Make sure you name the right person as the Trustee of any trust you create. A Trustee manages and protected the trust assets, among a variety of other duties and responsibilities. Make sure you understand exactly what a Trustee does and then take the time to consider whom the best person to appoint might be.
- Plan for Incapacity. Death is not the only potential problem for a parent. An incapacitating accident or illness could also create a problem for your children if no one has the legal authority to access your assets for their care and maintenance. Creating a revocable living trust and naming a spouse or other trusted loved one as the successor Trustee is one common way to handle the possibility of incapacity.
- Always give a caregiver a limited POA. Whenever you leave your child with a caregiver, always prepare a limited power of attorney that allows the caregiver to consent to medical treatment in the event of an emergency. Hopefully, it will never be needed but if it ever is, having the authority can save valuable time.
- Make use of life insurance in the early years. Many young parents do not have a substantial estate to leave behind to a child. If that describes your current situation, supplement your assets with life insurance until you amass enough actual assets that you no longer need the insurance cushion.
Contact Collins Law Group
For more information, please download our FREE estate planning worksheet. If you have additional questions or concerns as parents of minor children, consult with an experienced Los Angeles estate planning lawyer. Contact the Collins Law Firm by calling (310) 677-9787 to register for one of our FREE estate planning workshops.