Protect Your Children with Estate Planning
When you think of estate planning, you might picture sitting down with an estate planning attorney around the time of your retirement. This is that point at which most people begin to think about end-of-life issues, and start planning for the inevitable.
But younger people need to make the same plans; in fact, it’s vitally important for parents of young children to meet with an estate planning attorney at least once! Those who pass away in old age usually have adult children who are at least able to provide for themselves, but young children would face much more serious challenges.
There are two major factors that all parents should consider with regard to their children:
- Who would take care of them if something happens to both parents?
- How would you provide for children financially if something happens to one or both parents?
Under California law, a minor child is not allowed to care for himself, nor manage his own property. If both parents die, this could leave the child subject to a legal tug-of-war between family members and/or professional court appointed fiduciaries. In an even worse situation, the state might have to select someone to take guardianship of a minor child. When you choose a potential guardian for your child, considering not only your child’s emotional needs but also the ability of a particular guardian to manage your child’s money.
How will you financially provide for your child in the event of your passing? Any money you leave to your children, such as cash, a life insurance payout, or the proceeds from the sale of your home, must be protected. Some parents choose to establish a custodian account to be held for the child until he or she turns 18, 21, or 25. Alternatively, you might wish to establish a trust to be used for your child’s benefit until he or she is old enough to take control of the funds.
Talk to your estate planning attorney about the benefits of each course of action. Most importantly, don’t delay this important discussion with your partner. Whether your child is a newborn or a teenager, it’s a serious issue that all parents should confront.