You want to provide for your family, and an estate plan is one important way to support them even if you cannot be with them. However, if your children or other loved ones are under the age of 18, they may not be legally able to inherit the assets you leave behind. This can lead to a wide variety of different concerns. How can you leave assets to your young loved ones while also protecting their inheritance?
When will your loved ones receive their inheritance?
If your loved ones are under 18 and you pass away without an estate plan or rely solely on a will, they will receive the entirety of their inheritance once they turn 18. While the law regards them as an adult at this point, they may not be mature enough to make major financial decisions or have the skills to manage their inheritance on their own.
If you utilize a well-organized trust in your estate plan, however, you can outline when your loved one will receive the assets placed in trust. You can specify that they will receive full control of their inheritance at a certain age, designate some funds specifically for their education and use your judgment to determine other important details.
Who will manage the inheritance you leave behind?
Naming your underage loved one in a will or allowing the state to dictate the division of your estate can open their inheritance up to mismanagement. The court will appoint a guardian to manage their inheritance, but that person may not be someone you would want managing those funds. You also do not have the chance to define how they will manage your assets. Establishing a trust, though, provides you with the chance to choose a trustworthy person to manage your loved one’s inheritance and offer guidelines for distributing those funds.
Through careful estate planning, you can create a plan that protects and provides for your loved ones no matter their age.