You can give away your stuff, but you can’t give away your children

Dear Len & Rosie,

We’re a young couple that just had a daughter three months ago. We have outdated wills, and we’ve been looking at trusts and wills since before our daughter was born. If we don’t have a trust or will and we suddenly passed away, what will happen to our daughter? We want to ask my cousin and her husband to take her if anything were to happen to us. Do we need a will or trust in order to make that legal? What if my mother-in-law suddenly want custody of our daughter? Will that be a legal battle and a judge will decide? Will a will stating that we want my cousin and her husband to take our daughter be enough or do we need a trust in order to avoid problems like that?

Connie

Dear Connie,

You can give away your stuff, but you can’t give away your children. It’s important for you and your husband to make new wills to provide for your new daughter. But it’s just as important to understand that while you can make almost any provision for how your home and life savings are dealt with after you die, you can only suggest guardians to raise your daughter in your stead. Guardians are nominated by parents, just as actors are nominated for the Oscars. A parent’s nominee doesn’t always win, because guardians are appointed by judges, not the parents.

Why is this so? Parents sometimes make mistakes, or time may pass after a will is made and the trusted friend you picked as guardian could turn out to be a bad person. No judge in California is going to appoint a death row inmate as your child’s guardian, no matter what you want. In guardianship proceedings, the judge will take your wishes into account but must ultimately pick the guardian based on what he or she perceives to be best interests of the minor child. Fortunately, it usually takes a pretty good reason to convince a judge to ignore your stated wishes. But you have to state your wishes. That’s why you and your husband need to make wills setting forth your choice of guardians. And if there’s someone in particular you don’t want as guardian, such as your mother-in-law, your wills should say that as well.

Your estate plan should also be designed to protect your daughter from herself. The last thing you should want is for your bright and beautiful daughter to get her inheritance in one lump sum on her 18th Birthday. She’ll be broke by the time she’s 20. It would be worse if you have a son - he’ll spend it all on a car and not bother buying auto insurance. We have seen this happen.

Whether it’s just wills, or wills and a revocable trust, your estate plan should include a sprinkling trust for your daughter. A trustee that you pick will be in charge of your daughter’s inheritance, spending money on her for whatever she needs until she’s old enough to be trusted with the money. Most parents pick age 25, because by that age their child is out of college and is learning how hard it is to save money. And best of all, even if your mother-in-law Cruella somehow gets appointed as guardian, she won’t be in charge of your daughter’s inheritance.

You and your husband should update your estate plan, but if all you want is a quick guardianship nomination, you can download the California Statutory Will form, for free, on the State Bar’s web page, www.calbar.ca.gov.  Click on the link to the left labeled “Public Services.”

Len & Rosie