How to Protect Your Teenagers and Young Adults through Estate Planning
As parents we worry about our kids from the day we find out about them until… does it ever stop? I don’t think it does.
We worry about whether they’re eating enough or eating too much. We worry about the food we give them and the schools they go to. We worry about if we’re giving them enough opportunities or if we’re spoiling them.
Teenagers and young adults bring a whole new set of concerns. Driving, dating, academics, sports, first jobs, and so much more.
We worry about a lot of things when it comes to our children.
Today we’re going to talk about estate planning and how to plan to support your teenager or young adult— even if you’re not alive to do so.
Estate Planning Tools for Parents
Estate planning is like a toolbox. There are lots of different tools to put inside it that help you build out the best contingency plan for your family in the event you pass away.
Each family is unique and families grow and change from year to year. Even if you already have an estate plan in place from when your kids were first born, it’s good to evaluate that plan regularly in light of those changes. As the years progress, it’s likely that you may need different tools for different seasons of your family’s life. This is why estate planning should never be a one and done thing.
Let’s look at the most important tools to use to protect and care for your teenagers and young adults. Keep in mind, there may be other tools needed. Our team will let you know if we feel a different or additional tool is needed for your circumstances.
Trusts
If you have teenagers or young adults, you really need a Trust-based estate plan. A Trust allows you to put really specific rules in place for how your assets are distributed upon your death.
Think about your teenager or young adult. Their brains aren’t quite done yet. They don’t know exactly who they are yet. They barely know how to do their own laundry! It’s probably not wise for them to be given a large chunk of money to oversee. It’s probably even worse for them to be making decisions about real estate. Utilizing a Trust allows you to gift them those assets, but allows you to name a person or entity to administer those assets to benefit your child in the way you have outlined.
One of the best things about using a Trust is that you can plan for anything! If you intended to take your kid on a European vacation for their 21st birthday, you can state that in the Trust and make sure they get to experience that— even if you aren’t there. Same with cultural experiences like music lessons or traveling sports. If you want those options for your child, you can build it into your Trust’s plan.
Will
Even if you have a Trust you need a Will! But you absolutely have to have one if you don’t have a Trust.
A Will also allows you to make your wishes known. It allows you to say who gets what and you can specify how you want those items distributed, to an extent. It’s not as malleable as a Trust, and often in order to ensure certain wishes are followed testamentary Trusts have to be established. This is why we always recommend using a Trust-based plan. Because half the time the Will requires a Trust be created anyways, but then you’re not there to make the Trust say exactly what you want it to.
Given, what we discussed above, you may wonder what the point is to having a Will at all? The Will is the only place where you can name a guardian for minor children. Meaning, if you don’t have a Will the Court decides what happens to your children. This is why you need a Will. This is not a risk worth taking.
Standby Guardian
A standby guardian allows you to name someone who can care for your teenager temporarily if you’re unable to. This designation is only valid during your lifetime, and really needs to be someone within 1 hour driving time from you. This designation allows your standby guardian to make legal and medical decisions for your child, if needed.
Power of Attorney
This document also gives someone the power to make legal decisions on your behalf. Your agent can also use the Power of Attorney document to make medical decisions for your minor child, if needed.
Advance Directive for Healthcare
This document is one of the most important and loving documents. This document allows you to name someone to act on your behalf for medical decisions, should you be unable to do so. And it also allows you to decide in advance the type of catastrophic care you are willing to accept.
The reason this one is so important is because it takes a huge burden off of your family. Again, think of your teenager or young adult child. Their brains are not yet done developing. Something tragic has happened to you. Your family is being asked whether or not to continue with life support. That is a weighty decision for an adult with a fully formed brain. It’s impossible and potentially scarring for someone who is still a kid.
The Advance Directive puts that pressure on you and takes it off your kids.
Why Plan Now?
A well designed estate plan is a love letter to your kids. It says, “I’m your Mom/Dad. I love you so much. I planned ahead just in case and I’ve still got you.” It’s a powerful way to leave a legacy—leaving nothing to chance.
Call us at (404) 736-6066 or visit our website to schedule a consultation about how we can help you write that love letter to your loved ones and put a solid plan in place to help alleviate stress now and in the future.