Wills 101

If any of your heirs are minors as defined by the laws of your state (usually a person under age 18, although 21 is not uncommon), the court will appoint a guardian to hold or manage any money or property left to the child. You can influence who the guardian is by a Pre-Need Declaration of Guardian. As an alternative, in your will you can nominate the person or persons you would like the court to appoint as your child’s guardian and an alternate. While only the court can appoint a guardian, the will can be used in court as proof of your wishes. 

An alternative which can provide flexibility is to include trust provisions in your will to hold your child’s property. The trust would start on your demise and continue until your child reaches a specified age that you determine. It also allows you to give the trustee(s) instructions about how you would like the money invested and spent. This idea also works for anyone you want to leave assets to who isn’t “good with money.”

Whether you use a guardian and/or a trustee, in a side document, not in the will, write guidelines that are important to you for the person who will have legal responsibility for your child. 

As an alternative to a guardianship, many states have adopted the Uniform Transfers to Minors Act which permits you to leave your property to a named custodian for the benefit of your children. Property left to the custodian will be managed and distributed in accordance with the detailed rules set out in the Code. The property will be distributed to the child at whatever age you specify in your will, but generally not later than the child’s birthday specified in your state’s law. If you retain any control over the account at your death, and the child has not reached age 21, the account will be included in your estate for estate tax purposes.

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