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By Bernard A. Krooks, Certified Elder Law Attorney

Special Guest Contributor: Joel Krooks, Esq.

In this article, we will address some specific issues that arise if you have included minor children in your estate plan. If you have minor children, providing for their care and support will certainly be an important part of your estate plan. Here are some issues to consider:

Who will take care of your minor children when you die? Even though it is possible (and even likely) that they will be adults when you die, you still need to consider, and plan for, the possibility that you will die while they are minors. Of course, if one parent passes away, the surviving parent will be in charge of making decisions for the minor children. In any event, it is important for you to consider who should be the guardian of your minor children if there are no living parents. This is often one of the most contentious issues that couples face when doing their estate planning due to a wide variety of issues that arise in families over the years. For this reason, many delay having this important conversation. However, delay often results in taking no action which can lead to confusion and additional expense for your estate upon your demise.

Many individuals believe that when their spouse dies, all of their assets automatically pass to their surviving spouse. While this may be true in some circumstances, if an individual has an asset in their individual name and that asset does not have a beneficiary designation it is possible that the asset will partially pass to their children. New York State laws of intestacy provide that the surviving spouse inherits the first fifty thousand ($50,000) plus half of the balance. The children inherit everything else. This likely would not be the decedent’s intent and can cause potential issues if the child is a minor. Having a Last Will and Testament can quickly solve this potential issue. 

Although the surviving parent will have priority over custody and guardianship of your minor children, the same is not necessarily true regarding finances. If you have assets (stocks, bonds, insurance, retirement accounts, etc.) in your name alone and you want to leave this money for the benefit of your minor children, you may nominate whomever you select to be responsible for managing those finances. There are also several ways to do this from a legal standpoint. You could leave the money directly to your minor children. This is generally the least desirable way of doing this since minors are not permitted to own property. A court proceeding will likely be necessary to have someone appointed to be in charge of those funds. This will necessitate the involvement of lawyers and could get expensive. This is one of those situations where an ounce of prevention is worth a pound of cure. In many cases where folks attempt to do their own wills without professional legal help in order to reduce costs, they end up costing their estate a lot more in legal fees to solve the problems that they inadvertently created by trying to do the estate plan themselves.

Instead of leaving money outright to minor children, you could set up a trust for the benefit of your minor children and have the money managed by a competent trustee for the benefit of the children until a certain age that you select. This way, the money can be held in trust even after the minor attains majority. After all, think about what you would have spent money on if you had it when you were 21. If you decide to create a trust, you will need to select a suitable trustee. This decision can be almost as difficult as selecting the guardian of the minor children. One thing to remember is that the two roles do not have to be served by the same person. In fact, it is often advisable to have two different people serve as the guardian and the trustee. This way, one person is in control of the personal decisions for the minors, and one is in control of the financial decisions. Some feel that this provides a good system of checks and balances and doesn’t give one person too much control. One person might be great with kids, while the other may be better at dealing with finances.

While children bring great joy to parents, it does come with the responsibility to ensure their well-being not only when we are alive but also upon our death. So, do yourself a favor and think about who would be a good choice to be in charge of raising your children both from a personal and financial perspective prior to meeting with your estate planning attorney. This way, you will be in a better position to discuss the pros and cons of your choices with your attorney and then, hopefully, make the right decision for you and your family.

Bernard A. Krooks, Esq., is a founding partner of Littman Krooks LLP. He was named 2021 “Lawyer of the Year” by Best Lawyers in America® for excellence in Elder Law and has been honored as one of the “Best Lawyers” in America since 2008. He was elected to the Estate Planning Hall of Fame by the National Association of Estate Planners & Councils (NAEPC). Krooks is a past Chair of the Elder Law Committee of the American College of Trust and Estate Counsel (ACTEC). Mr. Krooks may be reached at (914-684-2100) or by visiting the firm’s website at www.littmankrooks.com.