Being a mom is a busy job. Whether your children are 6 or 16, it never seems to slow down.
In the day-to-day hustle and bustle of running kids to soccer practice and attending recitals, caring for them when they’re sick or just making dinner, many moms may not have thought about preparing for their children’s future.
What will your children do if an accident or illness takes you from them too soon?
If you’re a mom and you have not made an estate plan, it’s never too early to start. No one likes to think about dying young, but the truth is it happens more often than we’d like.
At the bare minimum, every mom should have a will that outlines who will have custody over her children. Without a will stating your wishes, the courts will decide your children’s fate. The court’s decision may not align with what you feel would be the best fit for your children.
But a will can do so much more. A will can also appoint an executor who will distribute your worldly goods as you would wish.
Maybe you want your assets divided evenly between your children. But maybe you would like to leave specific items (such as your mother’s tea set) to your daughter and a different set of family heirlooms (such as your father’s hunting rifle) to your son.
A will can ensure that your final wishes are respected and can reduce the chances of sibling quarrels.
A more sophisticated will can be used to shepherd assets for children, to minimize estate taxes and to provide for more structured distribution of assets to your beneficiaries according to your specific instructions.
Keep in mind that appointing a guardian in your will does not give that person or your children access to your assets. If your estate plan only includes a will, the courts would hold on to your children’s inheritance until they reach adulthood, at which time they would receive the entire amount in one lump sum.
Alternately, you could establish a trust for your children either individually or altogether. Your appointed trustee would ensure that your children would have the money they need to pay for their living expenses, health and education according to your directions.
Depending on your wishes, the trust could be set up to distribute each child’s total share of the inheritance at 18 or parcel it out slowly over a number of years. Distributing an inheritance a piece at a time allows your child time to fiscally mature.
Finally, consider that a trust may be a better option because it can be used to care for your children if you are incapacitated by an accident or an illness. A will, on the other hand, only takes effect at death.
Once you have made your estate plan, make sure you update it after every major life event such as a birth, death or divorce. Even if nothing else changes, revisit it every couple of years.
The parental guardian or trustee you choose now, may have health or financial problems later that would make them a poor choice. Alternately, a younger sibling that you wouldn’t have chosen now, may mature into a worthy candidate later. And if your assets change significantly you may want a more robust estate plan than is necessary now.
A trusted estate planning attorney can help you review all of these options and choose the one that is right for you.
Richard Barid and Michael Smith are co-founders of Savannah-based Smith Barid LLC, which specializes in estate planning and special needs planning. They can be reached at 912-352-3999 or richard@smithbarid.com or msmith@smithbarid.com.
By Richard Barid and Michael Smith