Florida Elder Law & Estate Planning Blog

How To Protect Minor Children With An Estate Plan: 5 Tips

Estate Planning For Minor Children

Do you have an estate plan that protects your minor child if you pass away? It’s essential that you do. If nothing else, this pandemic has demonstrated that no one is immune. Hopefully you will be around a long time to raise your child until adulthood and beyond. But just in case you are dealt other cards, you need a plan that includes a guardian for your child.

(1) How to Name A Personal Guardian in your Last Will and Testament

You’ve probably thought about who you would prefer to raise your child if you are no longer in the picture.  You should put your preference in your estate plan. In Florida, the only way to do this is to nominate a guardian in your Last Will and Testament.

If there are two parents, each should have his or her own will, naming one another as guardian. Each parent should also include back-up guardians in his/her will, in the event both parents are deceased. It’s best if the parents name the same successor guardian(s). Also name backups.

(2) How to choose a guardian for your child – factors to consider

There are numerous factors to consider when deciding who is best suited to serve as your child’s personal guardian. Among the issues you must consider are the individual’s values, temperament, whether they have other children and would be able to cope with yours. If your children are of school age, you might prefer someone who resides in your community, so your child has the stability of a familiar school and community.

Grandparents are often the first guardians that come to a parent’s mind, but if your children are very young, you must assess whether grandparents are physically up to the job. No matter who you name as personal guardian in your estate plan, it goes without saying that you should have a serious talk with the potential nominee to be sure they are willing to take on such an enormous responsibility.

When you pass away, the court will decide who is best suited to raise your child. Generally speaking, unless the person is patently unfit or there are other extenuating circumstances, the choice you’ve specified in your Last Will and Testament will prevail.

(3) Create a Trust to hold your minor child’s funds

You may not have extensive assets now. But your life insurance proceeds, and any lawsuit settlement coming to your estate should be earmarked to flow into a trust for the benefit of your child. Your will should call for the creation of this testamentary trust, to be created after your passing. You should appoint a trustee to manage the trust funds for the benefit of your child. This “guardian of the money” could be the same individual as your child’s personal guardian, but it need not be the same person. As with your child’s personal guardian, you should name backup trustees.

You can include a provision directing your chosen trustee to release the moneys in a staggered fashion once the child achieves the age of majority. Without a trust, your child would receive whatever you leave him as a lump sum when he/she attains the age of majority, which is 18 in Florida. At age 18, your child may not be sufficiently mature to handle a large sum of money. It might lead to bad decisions; for example, blowing off the idea of getting a post-high school education.

(4) Provide for each child’s individual needs with a Common Pot Trust

Obviously, it is impossible to know what level of financial support each of your children may need. Some may need more than others. For example, one of your children may turn out to be a gifted student who wants to attend an expensive Ivy League college. Another may develop a disability that requires he/she have special therapies. One of your minor children may need expensive orthodontics while another has perfect teeth. Who knows?

The way to handle these unknowable future financial needs is by adding a clause in your will that creates a Common Pot Trust. This trust will hold the funds for all your children. Rather than calling for the equal division of monies among all your children, it gives the trustee discretion to expend money based on each child’s individual needs.

The Common Pot Trust provisions usually state that the trust is dissolved when the youngest child achieves a certain age, at which point the monies can be divided equally among all your children. However, the funds need not be distributed all at once.

If there are two parents, each should have his/her own will containing this clause. The will usually indicates that the parents leave everything to each other, but if they both die, the estate will pass to the Common Pot Trust.

(5) Beneficiary Designations: it’s essential to review them!

You should not name your child as beneficiary of your assets. If you do and your children are minors when you pass away, the court will create a guardianship for them and select a guardian to hold the money they have inherited. The money will be released to your child when he/she reaches majority age, when he may still lack maturity to prudently handle a lump sum of money. It is preferable to require any money your child receives through a beneficiary designation to go to the trust you have set up for his benefit in your last will and testament.

Questions? Contact our attorneys at (561) 625-1100 or email to schedule a consultation.