Caring for your child’s needs is often a full-time occupation, leaving you little time to prepare for all contingencies. As a parent, you’ve probably spent some time wondering who would care for your children if you become seriously ill or die while they are still young. The easiest way to ensure that your children will be looked after by someone you approve of is to nominate a guardian in your will.

A guardian is someone who is legally authorized to make decisions on behalf of a child or an incompetent adult. The simplest way for parents to nominate a guardian of his or her choice is to name that person in the parent’s last will and testament. By doing this you can ensure that a judge who hears the guardianship petition will know whom you choose as the guardian. There is no guarantee that a court will choose the person you nominate, but courts generally give preferential treatment to the parent’s choice for guardian.

While naming a guardian in your will is always a good idea, it does not preempt the rights of the child’s other parent. For example, if you and your child’s parent are not married and you die, the other parent still has parental rights over the child. In such a situation the court typically does not appoint a guardian. However, if you and the child’s other parent were to die simultaneously, the court would consider the guardianship nomination of one or both of you. In this situation, if each parent names a different guardian, it would be up to the court to determine which nominee to choose. If the parents coordinate and nominate the same person as guardian, this makes it a much simpler task for the court to choose the appropriate person.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.

If you’re a parent, you know that traveling with young children can be stressful, to say the least. But what about traveling without your children? For some parents, like those highlighted in this Omaha World-Herald article, it can be quite worrisome.

So much so that according to the article, many couples choose to take separate flights when they travel without their children. The reason: they’re worried about what would happen to the children if both mom and dad died in an airline accident.

If you fall into this category of parents, it’s likely time to make an estate plan – or update the one you have. Your estate planning attorney can help you put together a plan that, at a minimum:

• Names a trusted guardian for your children
• Ensures your children’s inheritances would be managed by a reliable adult
• Makes sure your children’s babysitter is authorized to seek medical attention on their behalf

Don’t wait until your next grown-ups only vacation is looming. Ease your worries by putting a plan in place as soon as possible.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.

Bob and Ellen made a new Will as soon as Katie, their late-in-life baby, was born.  They named close family friends to serve as Katie’s guardians in case the unthinkable happened. After all, Bob and Ellen’s older daughter, Anna, was a freshman in college – too young for the job — and their own parents were no longer in shape to keep up with a young child.

Fast-forward twelve years, and circumstances had changed dramatically. Those close family friends had long since moved cross-country. Katie, now a pre-teen, didn’t even know them. She was now very close to her older sister, Anna, who was married with her own young family. So, Bob and Ellen made a new Will, nominating Anna to serve as Katie’s guardian.

While your family might not look like Bob and Ellen, chances are your circumstances have changed over the years. And if you have children, the person who would have made the perfect guardian when your kids were born might not even be in the picture by the time middle school rolls around.

Like many of the other aspects of your estate plan, you should review your choice of guardian every few years, just to make sure the person currently nominated in your Will is still the best fit for your children.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.

According to the 2010 Census, nearly 1 million children in the United States are living in households that are not only headed by their grandparents, but where their grandparents serve as their primary caregivers, and neither parent is present in the home. This is a far cry from the role of the “traditional” grandparent who was there to buy presents for the grandkids, fill them full of sugar, and then send them home for mom and dad to deal with.

If you’re one of these grandparent caregivers, you’re filling an incredibly important role for your young grandchildren. You’re not only supporting them financially, but you’re stepping into the shoes of a parent and providing much-needed love and guidance.

And, as you know all too well, there’s quite a lot of responsibility that comes with the task you’ve undertaken. Particularly if you have legal custody of your grandchild, one of these responsibilities includes reviewing your estate plan.

First, take a look at your Will. You’ll want to make sure that you’ve designated someone to serve as guardian for your grandchild in the event that you pass away while your grandchild is still a minor. You’ll also want to name a successor guardian, in case your first choice is unable to take on the role when the time comes. Make sure you speak to both of these people and verify that they’re willing to serve in this capacity.

Next, you’ll want to make sure you have an updated incapacity plan. This includes a Healthcare Proxy, with which you appoint an agent to make healthcare decisions for you if you’re unable to do so yourself. It also includes an Advance Directive, sometimes referred to as a Living Will, with which you spell out the medical treatments you do and don’t want your doctors to use in case you’re too sick or injured to communicate your own wishes.

If you plan to leave an inheritance to your grandchild, you’ll want to consider establishing a trust for him or her. Minor children are not allowed to control their own money or property, so absent a plan left by you, your grandchild will need a court-appointed conservator to manage his or her inheritance until he or she reaches adulthood.

If you haven’t done so already, now is the time to meet with your estate planning attorney. He or she can help you update your estate plan so that it meets the needs of both you and your grandchild.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.

When it comes to leaving an inheritance to your minor children, you’ll need to make sure that you arrange for an adult to manage each child’s money at least until that child reaches age 18. Otherwise, the court will appoint a conservator to do the job.

Parents often choose to establish trusts for the management of their children’s inheritances, and there are two very common options for accomplishing this purpose: the Child’s Trust and the Family Pot Trust.  The two arrangements have significant differences. Here’s a brief look:

Family Pot Trust

In essence, a Family Pot Trust allows for the inheritances of two or more children to be lumped together and managed by a trustee in much the same way as a parent would handle the family finances.  The trust assets are combined, and the trustee has the discretion to spend those assets on each child according to the needs and circumstances that arise.  There’s no requirement for the trustee to make equal expenditures for each child. 

The assets in a Family Pot Trust are combined together and managed as a unit while the children are minors, and then each child’s remaining share is distributed to him or her at the same time – often when the youngest child reaches age 18.  This arrangement often works well for families with young children who are close in age.

Child’s Trust

A Child’s Trust, on the other hand, is a trust established and managed for the benefit of a single child. In families with more than one child, a Child’s Trust can be established for each individual child.  Under this arrangement, specific property is designated for a specific child, and the assets of multiple children are held separately.

Because a Child’s Trust is for the benefit of one specific child, parents often feel greater flexibility in selecting the age at which trust assets are to be distributed to the child. For this reason, a Child’s Trust is often the arrangement of choice when a parent wants to leave a large inheritance to be managed well into adulthood; for instance, until a child reaches age 30 or 35.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.

Life insurance is one of the primary tools used by the parents of young children to ensure that their children receive an adequate inheritance. However, naming your children as beneficiaries – or alternate beneficiaries – of your life insurance policy can present a problem.

If you die before your children reach adulthood, the life insurance company won’t be allowed to distribute the proceeds of your policy directly to your minor children. Instead, your children will need an adult to manage the funds on their behalf. If you haven’t made arrangements for this in advance, then the court will get involved and appoint a conservator to handle your children’s funds.  Not only can this be a time-consuming and costly process, it also means that the person put in charge of your kids’ inheritance will have to follow restrictions imposed by state law when it comes to managing the funds, and it means that he or she may be subject to strict annual reporting rules.

What are your options for avoiding this situation?

1)      You can name your children as beneficiaries of your life insurance policy and name a custodian for those funds under the Uniform Transfer to Minors Act. You’ll also need to specify which percentage of your policy proceeds are to be allocated to each child. There are a couple of drawbacks to this arrangement:

• Often, you don’t get to choose the age at which the funds are handed over to your children.  Generally, your children get full control of the money – which may amount to a sizeable inheritance – at age 21.
• The custodian has control over how the funds are managed. You don’t get to place restrictions or set guidelines for how the custodian manages the funds on behalf of your children.

2)      You can establish a living trust, naming your children as trust beneficiaries. Once the trust is established, you designate the trust as your life insurance beneficiary.  If you pass away, the policy proceeds will be paid into your trust, where your trustee will manage them on behalf of your children.  This arrangement has the advantage of allowing you to set the rules for how your children’s inheritance is to be managed and when it is to be handed over to them. However, it also requires that you establish a living trust, which can involve added expense.

What about using a testamentary trust for managing your children’s life insurance proceeds? The problem with this arrangement is that a testamentary trust (one established in your Will) does not come into existence until your death. It is difficult to designate an entity that doesn’t exist yet as a beneficiary for life insurance purposes.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.

When it comes to making an estate plan, there are two issues that can loom large for divorced parents – especially if you have custody of your kids: (1) Will my ex get custody of my children if I pass away; and, (2) If so, will my ex have control of my kids’ inheritance?

Custody

As a general rule, when one biological parent passes away, and the children have not yet reached adulthood, custody of the children goes to the other biological parent. There are a few exceptions; for instance, if your ex is found to be a legally unfit parent, the kids won’t go to him or her. And, if your former spouse cannot or does not want to take custody of the children, then someone else will be appointed guardian. This is why you’ll want to talk to your estate planning attorney about naming an alternate guardian as part of your estate plan. And, if you believe your ex is an unfit parent, talk to your attorney about what strategies are available to you.

Money

Minors are not legally entitled to control substantial amounts of money or other property. So, if you attempt to leave an inheritance directly to your young children, the court will have to appoint an adult to manage that property on their behalf until they reach adulthood. And, if your former spouse is your children’s guardian, then he or she will likely get the job.

But, what if you want to keep your children’s inheritance out of the hands of your ex? In that case, you’ll want to talk to your estate planning attorney about establishing a trust for your children. This way, you can appoint a trustee other than your former spouse to manage your kids’ inheritance according to your instructions.

Whatever your estate planning concerns, it’s important that you’re open with your estate planning attorney. If your lawyer doesn’t know about your problems, he or she can’t help you find solutions.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.

With the excitement of starting your family, you want to focus on your plans, hopes and dreams for the future. Estate planning is probably the furthest thing from your mind. Plus, you probably feel like you’re too poor to make an estate plan, anyway. It’s something your parents and grandparents worry about. However, it’s never too early to plan for your family’s future. Here are some tips:

1. Make an incapacity plan. Emergencies can happen to anyone, not just the elderly. If you’re in an accident and can’t take care of your own healthcare or financial decisions, you need to have a plan in place so that someone can step in and take care of these things for you. Otherwise, your family will have to go to court and have someone appointed to do the job – a time-consuming, expensive, and emotional hassle. There are estate planning options like a living will and an advance medical directive that you can use to deal with medical planning, and a durable power of attorney can help with financial emergencies. But these documents have to be in place in advance. Once you’re incapacitated, it’s too late to put an estate plan in place.
2. Put a plan in place in the event of your death. Anyone can die at any time, and untimely death is unfortunately a fact of life. You should be prepared with a Will or a Revocable Living Trust. Either of these documents will allow you to pass your assets on to the loved ones of your choosing, at the time and in the manner that you choose. If you die without an estate plan, also called dying “intestate” your assets will pass to your family members in the manner dictated by state law. This may or may not be what you want to have happen.
3. Be sure to name a guardian for your children. If both you and your spouse die while your children are still minors, someone will have to step in to take care of them. If you leave an estate plan naming a guardian, you’ll have the peace of mind of knowing they’ll be raised by people you’ve chosen, whom you know, trust and approve of. If you haven’t named a guardian, anyone may petition the court and, upon convincing the court they’re fit for the job, can be appointed to care for your children. Usually this is a family member, but it may not be the person you’ve chosen.

Estate planning is not just for the elderly or the wealthy, it’s for everyone. Especially if you have a growing family, it’s the responsible thing to do.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.

If you have minor children, you have a major decision to make when creating your estate plan, and that is whom you will choose to be the guardian of your children. This is probably the most important element of any estate plan, as your children are your most precious assets.

Because the guardianship of your minor children is such an important decision, you will want to consider the person you choose for this task very carefully. Here are some of the issues you will have to look at when making the decision of who will take care of your children if you are no longer around to do it.

Location – If you would prefer that your children stay in the same general location to where you live now, the location of the potential guardian will have to be considered. Most people will not relocate if they become the guardian of someone’s children; instead the children will probably have to relocate.

Parenting – There is no doubt that the person’s parenting skills will play an important role in the lives of your children, so you should know how well the person is likely to do in this area. If they have children of their own, do you see good parenting or are these children with childcare most of the time. In the case that this person has no children, are you familiar with how they were raised. Especially important is that person’s views on discipline, school, etc.

Personal Beliefs – It only makes sense that you will want to choose a guardian that shares many of your own personal beliefs, such as religion, politics, etc. You are unlikely to find someone that believes exactly like you do, but someone that leans toward the same beliefs would obviously be a better choice than someone who holds an opposite view. You cannot expect this person to set aside their own beliefs and teach your children differently so if you disagree with this person’s beliefs or values, it’s probably best that they don’t raise your children.

Potential Guardian’s Personal Situation – The potential guardian’s personal and financial situation will have a lot of influence on your children so this is something you will need to consider carefully. If the person is older, they might be financially sound without excessive outside obligations, but it is also possible they will not live until your children are adults. Their family situation is also important, if they are single and young, they may be too self involved to worry about raising someone’s children; this may also be true if they have a family of their own. If they have their own children and a spouse, how will these other people influence the lives of your children?

Although these things seem like a lot to think about when choosing a potential guardian for your children, they are all very important. You may also want to consider naming more than one guardian, just incase something should prevent your initial choice from performing this duty.

The Law Offices of James A. Miller is a member of the American Academy of Estate Planning Attorneys.