Why Young Families Need Estate Planning: Securing Your Child’s Financial Future

In my last blog post “Why Young Families Should Start Estate Planning“, I discussed the importance of estate planning for young families and the consequences of dying intestate.

Inheritance Paid Into Court

If a minor child inherits more than $35,000 and their parent either died without a will or no trust was set up in the will, then the child’s money will be paid into court. This is to protect the child’s financial interests and ensure proper management of the funds during their minority.

If the person caring for the child needs to access the funds because they cannot afford an expense that is for the direct benefit of the child, they can make a request to access the funds through the Minors’ Funds Program. This program allows limited access and is designed to safeguard the child’s assets while providing necessary support.

However, if they want to avoid the money being paid into court, they will need to apply to the court to become the guardian of property for the child.

Guardian of Property

Our estate lawyers would be happy to assist them with their guardianship application, but there are challenges:

1. Legal costs
2. Delay
3. Limitations on how funds can be used
4. Need to make a management plan, setting out how you plan to manage or use the child’s assets
5. If it’s contested, then the costs will be even higher and the court may not pick the person you expect

Estate Planning

All of this can be avoided with good estate planning. We regularly recommend that our clients with minor children do the following:

1. Name a guardian so they can act immediately after your death, while they apply to the court for permanent guardianship. This also minimizes disputes.
2. Set up a trust so your trustees can begin managing your child’s inheritance without court involvement. Trusts provide more control over the funds and greater flexibility in their use.

Proper estate planning minimizes delays and legal costs associated with guardianship applications and securing your child’s financial future.

If you have minor children, proper estate planning can spare your family unnecessary stress, delays, and legal costs. Our experienced estate planning lawyers can help you name guardians, set up trusts, and create a plan that protects your children and their inheritance. Contact Mills & Mills LLP today to schedule a consultation and take the next step toward peace of mind.

At Mills & Mills LLP, our lawyers regularly help clients with a wide range of legal matters including business law, real estate law, estate law, employment law, health law, and tax law. For over 140 years, we have earned a reputation amongst our peers and clients for quality of service and breadth of knowledge. Contact us online or at (416) 863-0125. The material provided through the Mills & Mills LLP website is for general information purposes only. It is not intended to provide legal advice or opinions of any kind.