Hopefully, you will live to see your children grow into fine adults. Yet, if your children are not yet 18, you should have a plan in place in case you die while they are still minors.
There are two main elements to this. One is nominating a guardian who would take legal charge of them until they turn 18. The other relates to the kid’s inheritance.
Minors cannot directly receive the money you leave them
The minimum age to inherit is 18. So you need to consider your options in case you need to leave your kids money sooner. One is to put your property into a trust for them.
Someone of your choosing would act as a trustee and manage the money for the children until they can legally inherit. You can have them manage it till much later if you wish, as most 18-year-olds would struggle to use an inheritance sensibly.
You can give the trustee free rein to use their discretion when distributing money, or you can set out strict conditions, such as your kids only get a certain amount each year until they turn 25. It’s up to you, but do not be too prescriptive, as it is hard to tell what is ahead.
Remember, the guardian will also need money to raise your kids
Let’s say your sister agrees to act as guardian. If you cordon off all your money for your children’s inheritance, then your sister will have to use her own money to raise your kids, which could leave her and them struggling.
Learning more about how you can provide for your children is just one of the many things to consider when creating an estate plan. There is help available to learn more.