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Examiner
  • Ken Garten: If you have a child, you need a will

  • The time in one’s life when assets are often the scarcest is when the children are young.


    For many, that is the time when they are just starting out in life, income is not always high, and they have not yet had the chance to accumulate a lot of assets.

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  • The time in one’s life when assets are often the scarcest is when the children are young.
    For many, that is the time when they are just starting out in life, income is not always high, and they have not yet had the chance to accumulate a lot of assets.
    Plus, raising young children tends to be a drain on financial resources.
    So many in that situation mistakenly believe that it is not important to have a will, because they “don’t have anything.”
    Indeed, they are wrong, in my opinion.
    They have small children.
    And few things are more important than having in place a plan for one’s children in the hopefully unlikely event of both parents’ demise.
    Among the important provisions in a will for those so situated is the selection of a guardian to raise their children. Absent an advance selection of a guardian in a will, the court system will do its best to select the proper guardian for orphaned children. Sometimes, the choice is fairly clear, and without great controversy. Sometimes, the opposite is true.
    Regardless of which category parents of minor children may fall into, or think they fall into, there is no substitute for addressing the issue in definitive terms in advance of a devastating event that may orphan someone’s children.
    Such action diminishes stress, uncertainty and conflict among grieving survivors, which does a favor for no
    Another critical issue is the handling of assets and life insurance proceeds distributable to the children.
    If children inherit money or receive the proceeds of life insurance, then that money is held in a fund that is overseen by the probate court until they turn 18 years of age.
    Prior to age 18, the court must approve use of funds, be it for basic needs, a car, elective surgery, summer camp, or the opportunity to travel. Different courts and different judges may have differing philosophies on such expenditures that may or may not comport with what a deceased parent would have wanted. Typically, courts are extremely conservative in such matters, for good reason.
    Furthermore, and perhaps of greater concern, when the child turns 18 years of age, then their money is turned over to them.
    The unfortunate truth is, few 18 year olds are mature enough to properly manage and put money to wise use.
    More unfortunately, most 15, 16, and 17 year olds are unlikely to plan for their future when they know that they are getting what seems to them like an enormous amount of money the day they turn 18, which money they tend to blow rapidly and foolishly.
    Children in such circumstances can end up without a high school diploma, or any of their money, by their 19th birthday.
    Page 2 of 2 - To avoid this possibility, wise planning calls for the parents to set up a testamentary trust in their will, to hold the children’s proceeds from parents’ estates and life insurance.
    A trustee, whom the parents trust implicitly, can be appointed to hold the child’s funds until age 25, or whatever age the parents may deem advisable.
    During childhood and adolescence, the trustee can be vested with broad discretion in the use of funds in each child’s best interests based upon the circumstances of the particular case, without having to convince a court to give permission, be it for baseball camp, a car, a trip, college, trade school, starting a business, a wedding, a down payment on a house, and all of the various spending decisions that must be made from the age of childhood until age 25. This offers flexibility and discretions that courts may tend not to extend.
    And perhaps most importantly, an adolescent child does not go through life knowing that at age 18, a lump sum is going to fall into their lap. Instead, the only money that child receives before age 25 is with the blessing and approval of a trusted trustee his parents chose before they passed on.
    Ken Garten is a Blue Springs attorney. Email him at krgarten@yahoo.com
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