Section 6: Protecting Your Children
For parents, ensuring their children’s care and protection is the primary motivation for estate planning. A comprehensive plan addresses both personal care through guardianship and financial protection through appropriate trust structures.
Guardianship Provisions
As discussed before, you can nominate guardians in your estate plan, create backup arrangements and discuss your wishes and expectations with proposed guardians. Beyond simply naming guardians, consider documenting your wishes about your children's upbringing in greater detail. A letter of intent can provide guidance about educational goals and preferences, such as public versus private school, college expectations, and learning styles or special needs. Address healthcare needs and preferences including doctors and specialists your children see, medications and treatments, dietary restrictions or preferences, and mental health support if needed.
The more information you can provide, the easier the transition will be for your children and the guardians.
Financial Protection Through Trusts
Rather than leaving assets directly to minor children, which would require court-supervised conservatorships, most parents create trusts to hold and manage assets for their children's benefit. Trusts provide flexibility, professional management, and protection while allowing you to specify exactly how funds should be used and when children should receive distributions.
Protecting Children’s Inheritance from Outsiders
Trusts also protect children's inheritances from creditors, divorcing spouses, and poor financial decisions. When assets are held in a trust rather than distributed outright, creditors generally cannot reach trust assets to satisfy the beneficiary’s debts. Additionally, if a child divorces, the trust assets are typically not considered marital property subject to division.