I’ll admit, deciding how to choose a guardian for your kids isn’t a lot of fun. Who wants to think about a situation where their young children are left to mourn their parents and live with friends or relatives? Nevertheless, choosing a guardian to raise your children and manage their inheritance is a crucial piece of an estate plan if your family includes a minor child. If you don’t do it, you leave the decision to the court.
U.S. News and World Report’s recent article “How to Choose a Guardian for Your Child” says that, at worst, forgetting to name a guardian can mean a long court proceeding. This can be expensive, cause stress in family relationships and put your children in guardianship limbo.
There are two types of guardianship roles to consider when deciding how to choose a guardian for your children: guardian of the estate and guardian of the person. The guardian of the estate is a person who’ll manage the minor child’s inheritance on their behalf. It’s a fiduciary responsibility, and this guardian must make sure he or she carefully and appropriately manages accounts, keeps receipts, reports back to the court and doesn’t comingle the child’s assets with his or her own. Another option is for a parent is to set up a trust and have a trustee (who can be the same person you would name as guardian) manage the funds for the child. This can allow the parent more control over how and when money is distributed, especially if you anticipate leaving a substantial inheritance.
The guardian of the person is the daily caretaker who’ll make sure your child gets health care, educational, housing and has all other needs met.
These two guardians can be the same person or different people, depending on the skills and abilities of your family members and friends. A separate person managing the estate can provide a series of checks and balances that can help, if you are concerned about the misuse of your child’s funds.
You may want the guardian of the estate to have good money-management skills. The guardian of the person may be someone who shares your same values, has the energy to raise a child, and is close by so that your child doesn’t have to lose the familiar comforts of their school and neighborhood.
You should also name backup guardians, in the event that the primary guardian is unable or unwilling to take on the responsibility. You should also be sure to speak with your guardians ahead of time and make certain they understand the responsibility and are willing to take on the task of helping care for your children, if you pass away.
In most states, you’ll need to name your guardian or guardians as part of your will. That is the safest way to choose a guardian for your children to ensure it is legally enforceable. In California, you may appoint a guardian through a will or other written instrument by following certain formalities.
Talk to an experienced bay area estate planning attorney with any questions about how to choose a guardian for your kids in your will, and if including a trust for your children is a wise idea for your situation.
Reference: U.S. News and World Report (June 4, 2019) “How to Choose a Guardian for Your Child”