When You Want to Provide for Your Children

When you have minor children, your will should always be used to name a guardian of their persons and property. You should also name alternates who could be a guardian if your first choice is unavailable or unwilling.

Of course, if there is a surviving parent, he or she automatically is the guardian, if living in the same household. If there has been a divorce, the parent with legal custody of the children should designate a guardian. If you name someone other than the other parent as guardian, however, the designation may not be binding. When a custodial parent dies, the non-custodial parent always has priority in seeking guardianship and custody, unless unfit.

The court will probably have to approve a proposed guardian, even if he or she is named in your will. The purpose of naming the guardian in the will is to guide the court and to avoid family arguments over who is better qualified.

If you feel it's necessary or appropriate, two guardians can be appointed: one over the child and one over the child's property. Consider carefully, however, the appropriateness of leaving money or other property outright to young children, even if a qualified guardian is available. Guardianship is a cumbersome way to manage financial affairs. Periodic reports and accounting to the court are required, and flexibility is limited by law.

Guardians aren't legally obligated to support the children out of their own pockets, and might not be able to, anyway. Public welfare benefits might be available, but it's unwise to rely on them as a first option. So adequate funds, through life insurance or otherwise, should be available to care for your kids.

More importantly, for many, is that guardianship ends at the age of legal adulthood (usually 18, sometimes 21). From then on, any property left a child is exclusively owned and controlled by the child. People easily recognize that it's bad to die without a will, but forget that it might not be any better to die with a will if it results in leaving property to minor children. With or without a will, those kids grow up to be 18 year olds and the guardian must turn over the property.

If you'll be committing significant assets immediately after your death to the direct benefit of your children (as opposed to their surviving parent), a trust is the way to go. A trust is a must to keep your estate from falling into the hands of teenagers, if you have left your children money and die while they are young.

Michael Palermo is a Lexington, Kentucky estate planning lawyer and Certified Financial Planner. More information about estate planning can be found on his Web site.

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