As parents, we want the absolute best for our children. That’s why estate planning can be especially difficult for parents of children who are still too young to take care of themselves. It can be daunting to name a guardian to step in and handle the care and upbringing of your children if you can’t be there. And then there’s the concern of who should manage the inheritances you plan to leave behind. Minor children aren’t legally permitted to manage significant amounts of money for themselves.
The simplest way to make a contingency plan for your children’s future is to pick one person to handle both tasks – caring for your children and managing their inheritances, too. In some families, this is a very workable solution – there’s one adult who would make a great day-to-day caregiver and who would shrewdly and effectively handle the children’s money.
However, this is not a viable option for every parent. Many people have relatives or friends who would be fantastic money-managers, but might not be well-suited to shepherding children as they grow up. What’s the solution? Choose different adults to handle each of these two essential functions.
Your children’s guardian does not need to be the same person who manages your children’s money. Instead, you can choose one trusted adult to serve as guardian, and another trusted adult to serve as trustee or custodian of your children’s inheritances.
Your estate planning attorney can help you structure a plan that will provide the best possible protection for your children, while meeting your family’s other estate planning needs as well.