Does Your Estate Plan Protect Your Children?


You may not know it, but you have an estate plan. Even if you have never taken the time to visit an estate planning attorney and have a trust or a will drafted, the state of California makes certain presumptions about what you would want as a parent in the absence of a specific written plan that you have signed with the appropriate formalities.

The first presumption is that you would want your children to receive all of the money from your estate when they turn 18

Remember how good you were with money when you graduated from high school? The state of California presumes that at the age of majority (18) your child can adequately manage any inheritance they might receive through a probate administration, or as the proceeds from a life insurance policy, etc. This could equate to hundreds of thousands of dollars in a typical estate. Taking the time to set up a trust gives you the control to decide how and when your child receives their inheritance. You can set age milestones (i.e., 50% of the estate distributed at age 25 and the remaining 50% distributed at age 30), or performance milestones (i.e., achieving certain grades in college). Your choices are unlimited; your estate planning attorney can tell you what some typical options are. No one knows your children as well as you do. As they grow and their personalities become more distinct you have the ability to reshape your estate plan to grow with them.

The second presumption is that you want your estate divided equally among your children

While your children are still under 18, generally you are inclined to treat them all equally when you consider how you want your estate distributed upon your death. However, we all realize that as children grow up they don’t all turn out as self-sufficient as we might have hoped. If you have a child who is now an adult and has a substance abuse problem, a spending problem, possibly even an abusive spouse, would you feel comfortable handing them hundreds of thousands of dollars? You may have a special needs child who will require a particular type of trust to protect their right to continue to receive governmental benefits, and you may feel that they require a different ratio of your estate. If you are unfortunate enough to have severed a relationship with a child (either through your actions, or through your child’s), while retaining solid supportive relationships with your other child(ren), would you want all of these individuals to receive the same sums of money upon your passing? You may, but then again you may not. The state of California presumes that you would want all of your children to receive the same amounts when you die.

The third presumption is that those family members with the closest relation to you would make the best guardian(s) for your children

Every family has at least one member who has difficulty with money, or difficulty holding a job, or difficulty maintaining relationships. Just because you share the same parents, you and your siblings (or even you and your parents) do not necessarily subscribe to the same philosophies on child rearing, religion, spending, etc. You possibly are more aligned with one particular sibling in your personal views on parenting, or perhaps you don’t see eye to eye with any of your family on this point. Your entire family may live on the other coast, also. However, you may be fortunate enough to have a close friend that shares your views on parenting that lives right around the corner from you. The courts will give preference to those with familial ties. Without formally nominating an individual in your estate planning documents, a close friend who might be the best guardian for your child(ren) would be required to launch an expensive and protracted campaign in court to try to become guardian of your children.

The fourth presumption is that your children can get along without any money during the administration of a probate estate

Probate is a long process. A typical estate takes a year to complete, and in many instances, much longer if there are any problems or complications. The guardian of your children would have to make particular requests of the court for a family allowance, or for an early (preliminary) distribution of a portion of the estate if they wanted to receive any financial support for your children during this process. If you have a trust in place your child(ren) will receive financial support virtually immediately, according to the terms of your trust.

The fifth presumption is that a former spouse would be a great person to act as guardian of your child’s inheritance

If you have a former spouse, you may be fortunate enough to have maintained at least a civil relationship with that person throughout and after your divorce proceedings. However, if you are like a great majority of people, you may find contact with your former spouse to be quite difficult. Without a trust, the surviving parent (your former spouse) has priority in being appointed as the individual to handle money left to your children.

The sixth presumption is that you would want your new spouse to receive a share of any of your separate property

Under the laws of intestate succession, if you have remarried, and have children from a prior relationship your separate property (everything you have when you remarry) will be split between your new spouse and your children (the ratio depends on the number of children you have). You may even have done an estate plan prior to remarrying that mentions the person you eventually marry, and leaves them some nominal gift. If you don’t take the time to update your plan after remarrying, and acknowledge that you have a new spouse in your will or trust, the state of California presumes that this is an oversight and you really intended to leave your new spouse a portion of your separate property estate (coming right out of your child(ren)’s share).

Your children’s welfare is the central focus during your lifetime. Drafting a will or a trust with a qualified estate planning attorney is an easy and relatively inexpensive process that can ensure that your children are cared for after you are gone.

The contents of this article are not intended to provide legal advice. Seek the counsel of an estate planning attorney for advice on your own individual estate plan.