Who is going to take care of my child if I cannot? That is the first and foremost consideration of Estate Planning for parents with children under the age of 18. This brings up the question of Guardianship. There are two types of Guardianships in California.
A Guardian of the Person is someone who is appointed by the Court to be responsible for the child’s physical well being. Parents typically nominate the guardian in their Wills. If there is no Will, the family member who wishes Guardianship will apply to the Court. Either way, the Court does an independent investigation, and makes the appointment. Interestingly, the guardian and the caregiver can actually be separate people. The guardian decides what is the best living situation for the child, which may or may not be with the guardian. For example, I have named my 22 year old daughter as guardian for her 13 year old brother. She may decide that he would be better off living with his grandparents or family friends, depending on life circumstances at that time. The choice would be likely be different at age 13 than age 16.
A Guardian of the Estate is someone appointed by the Court to be responsible for the child’s money. It is unusual for children to have or receive money in their own names, as most people hold funds for children in custodial accounts. It is also extremely undesirable; therefore most people leave inheritances to children in a Trust. If funds are held under a Court Guardianship, the Guardian must report to the Court each year, and the child receives the funds outright at when reaching the age of adulthood (18 in California). Going to Court is always expensive, eating away at the funds, which are limited to investing in Money Markets or CDs. Another point to consider: How many 18 year olds are capable of making good choices when faced with a large sum of money? It is important to be educated when making choices to protect your children. I’d be happy to discuss these matters with you.
Leave a Reply