Welcoming a child into your family brings many changes to your life. If you have any children under the age of 18, you should have an estate plan in place to provide for, protect, and support them. Putting a comprehensive estate plan in place can provide numerous benefits to families by helping them prepare for the future and the unexpected.
Who will care for your children if you pass away?
As a parent, you have probably put a great deal of thought into how you want to raise your children. However, without a proper Will designating a Guardian in the event of your untimely death, the court will determine who will get custody of your children. There may even be a long and costly court battle if there are competing persons seeking to be named Guardian, none of whom may have been your desired choice.
A properly drawn Will enables you to name a Guardian (and even an alternate) who will have custody of and care for your children in accordance with your wishes. This will ensure that the person(s) raising your children will be someone you trust, providing your children with stability during a difficult time, while upholding your values and desires as they grow.
How will your children be provided for financially?
Another critically important reason to have a Will is to financially provide for your children. You can do so by including a Trust in your Will, in which your money and other assets can be held (after your death) to meet the expenses of raising your children, including housing, medical, education (including college) and other general needs. By creating a Trust for your children, you would name a Trustee (and an alternate), who is the person responsible for using the Trust funds to support your children in accordance with your wishes after your death. The Trustee is legally bound to use the Trust funds only for the children and strictly in accordance with your wishes.
The children themselves would not directly receive or have access to the funds in trust until they reach a certain age designated by YOU (e.g., 18, 21, 25, etc.). In New Jersey, children under 18 cannot hold property or money themselves. However, without a Trust in your Will, the courts are forced to turn over the entire inheritance to a child upon reaching the age of 18. Consequently, controlling the age at which your children will finally have direct access to the funds you’ve left them is as important as creating the Trust itself. We all know young people make mistakes. A child at 18 might not be as prudent as one of 21 or 25 if left with a significant inheritance. Hence, by not addressing these issues in advance (by creating a Trust for your children in your Will), you would be leaving their care and support to the whim of a judge who knows nothing of your children or your wishes.
Take the necessary steps now to protect and provide for your children
Effective estate plans can help you prepare for various future situations and provide you with peace of mind as your children grow. Whether you are a new or existing parent, now might be the perfect time to start planning for the future. For additional guidance and information tailored to your specific needs, we encourage you to seek out the services of the knowledgeable attorneys at Mariano & Coiro, P.C. by calling 732-860-7620 or emailing us.