The most important item in estate planning for parents of minor children remains “Who will take care of our kids if something happens to us?” Many considerations properly go into who to select as the legal Guardian for minors. Parents, biological and adoptive, may decide who shall serve as Guardians of their minor children if the parents die. Virtually every state requires that Guardians be nominated by the parents through a written, signed instrument. A Will is the most-often utilized document for this purpose. In the absence of proper Guardian nomination, a judge (and not your family) decides who will raise your children.
Nominate Guardians you trust to provide love and care for your children. Also consider the ability and willingness of the Guardian to follow instructions or guidance left behind. Guardians need not be family members if others may be better suited. If you nominate a couple as Guardians, define what happens in the event of divorce. If your Guardian does not live local, who will relocate? A non-US citizen can be a Guardian, but plan carefully as many, many issues become implicated with that choice.
Providing financially for your minor children’s well-being should also be spelled out clearly for the Guardians. You could leave a lump sum amount to the Guardians to raise your children (really bad idea!). Or, funds could be placed in a Uniform Transfers to Minors Act (UTMA) account. UTMA accounts are relatively simple and have few transaction costs. UTMA accounts need a Custodian, but not a Trustee. However, UTMA accounts “age out” meaning that all assets become the property of child at a certain age (usually 18 or 21). Or, funds could be placed in a Trust. You can set the terms of the Trust; define life events (e.g., graduation) or ages for distributions; provide extended creditor or asset protection; and allow for Trust modification if things change.
If you have minor children, properly name and plan for a Guardian in your estate documents. If you have not done so, contact Michael Geiger at Geiger Law for assistance with Guardians as well as all your estate planning needs.