· I am a single parent with minor children. Is there special planning I should consider to take care of my children and myself?
As a single parent, it is critical that you design a plan that will designate a guardian for your minor children and a trust for the management of any assets they inherit. Generally, if you are divorced, the legal guardian will automatically be the surviving parent by law. However, there are times when the surviving parent is unwilling or unable to accept his or her parental responsibility. Therefore, it is important to designate in your pour-over will who you would nominate to be your children’s guardian in the event you have the right to do so. In addition, you should choose the person or institution you believe to be the best to serve as a trustee to manage your children’s assets. For the children’s best interests to be served, select a guardian and trustees who will coordinate their efforts to care and provide for the children.
It is equally important that you structure a plan to care for yourself and your children in the event you become disabled. One way of doing this is to use a power of attorney. Unfortunately, even good powers of attorney fail because third parties, such as attorneys, banks, and lenders, can choose whether or not they will rely on the document and act on it to release assets. Thus, at the time when you need it, a power of attorney may not be effective, and then a guardianship will be required. Another negative aspect of a power of attorney is that is does not provide any direction to the agents on what action they should take; therefore, agents can make decisions according to what they deem appropriate rather than on the basis of your directions or instructions.
The most effective disability planning tool for providing for yourself and your children is a fully funded living trust. You can include instructions for the care of your children and yourself in the event you become disabled, thereby eliminating the need for a guardianship or conservatorship to manage your assets.
By establishing a carefully drafted living trust plan and transferring your assets into it, you can avoid probate and will be well on the way to implementing a comprehensive estate plan to care and provide for your children and prevent unnecessary hardships, delays, and expenses in the event you become disabled or incapacitated.
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