A crucial part of your estate plan involves the distribution of your property and assets to your children. These instructions for your kids should be clearly laid out in your will or living trust, and so it’s important to know all of the components you should be including.
What Are My Property Arrangement Options?
Identify a property guardian in your will: The property guardian will manage any property that the child inherits if there is no other external system to handle it (such as a trust). You may also name a custodian under the Uniform Transfers to Minors Act (UTMA), which is another option for choosing someone to manage property you’re leaving your child.
Use life insurance: Either through your child’s trust or a UTMA custodianship, you can name a property manager for your children through your life insurance. Review your life insurance policy to know how this process will specifically work for you and your family.
Set up a trust for each child: Under this arrangement, you use your will or living trust to identify a trustee who will manage money or property that the child inherits until the child reaches a certain age. If your child is already at or over this age at the time of your death, the property will go straight to them and the trust will never become active.
Create a “pot trust” for all children: Depending on how many children you have and how young they are, you might consider just setting up one trust for all of them, which is called a pot or family trust. In your will or living trust, you would identify a trustee who will have the duty of allocating the trust money to each of the children.
Any of these options are viable for your inheritance arrangements to your children, depending on your family’s specific circumstances. Our Austin law firm provides excellent estate planning services for you and your family, and our attorneys can give you proper legal advice on which estate plan option is best for you. Contact Sheehan Law, PLLC today for a consultation.