Who Do You Love? Who Do You Trust?

I ask every client “Who do you love. Who you do trust.” Initially, no one knows how to respond to these questions. Everyone wants to talk about who will receive their assets. That is not why I ask. The people we love and trust, the people who love and trust us, are the best people to serve as our successors or to be given authority to select our successors. Estate planning decisions come from the heart, after a long discussion about family dynamics and what is in the best interest of the children.

Almost every client has asked me “Should the same person be the trustee and guardian?” I tell them that there is no wrong way or right way – only their way. What I have heard my clients say is “I don’t want my sister, who works in finance and is a genius with money, serving as trustee because I want her 100% focused on the well-being of my orphaned children.” I have also heard “While my brother isn’t great with money, I trust him to bring on advisors to help him. He loves us and he loves our children and he will do the right thing as guardian and as trustee.” Only you know the dynamics between and among the people you chose. Will Chris the guardian come into conflict with Pat the trustee because they have a history of trying to control each other? Will Jordan who lives in Kansas understand that a request for $3,000 for club soccer from Morgan in San Francisco is not a ridiculous ask, but a typical expense for an athletic, competitive and dedicated child?

Estate planning is not filling in a questionnaire and then signing documents. If it was, I would not do this work. Counseling my clients, and helping them determine what is in the best interests of their children, is one of the most satisfying parts of my work. These are important decisions, and I am honored every time I am asked to help.

Warmest Regards,

Patricia
Principal, De Fonte Law PC

Should Your Child’s Guardian and Trustee Be the Same Person?

If you have overheard any discussion about estate planning, you have likely heard the words “guardian” or “trustee” tossed around in the conversation. When it comes to estate planning, who will be ultimately in charge of your minor child is an important decision that requires consideration of many factors. Although there is no substitute for you as a parent, a guardian is essentially someone who steps in as a parent, assuming the parental role and raising the child through adulthood. A trustee, on the other hand, is in charge of managing the financial legacy that has been left behind for the minor. As a parent, you need to take into account the characteristics needed for each role.

Who Makes a Good Guardian?

When choosing a guardian, the top factor to consider is who is the best person that will love and raise your child in a manner that you would. This would include religious beliefs, parenting style, interest in extracurricular activities, energy level, and whether or not he or she has children already. Keep in mind that a guardian will provide day-to-day love, care, and support for your child. While the guardian you choose may be great with your children, he or she may not be great with money. For this reason, it may make sense to place the financial management of your minor child’s funds in the hands of someone else.

Who Makes a Good Trustee?

Not surprisingly, when choosing a trustee the most important characteristic is that he or she is great with finances. Specifically, the trustee must be able to manage the funds in accordance with your intent and instructions that are left in your trust. Consider whether he or she will honor your wishes. Likewise, should you choose to grant your successor trustee discretion in making financial decisions regarding the management of funds left behind you should ensure the individual’s decisions will be aligned with your intent. In short, you want to choose a successor trustee who will act in your minor child’s best interest within the limits you have set forth in your estate plan documents. If you choose two different people for the role of guardian and trustee, make sure to consider how the two get along as they will likely have to work together throughout your minor’s childhood and possibly into adulthood.

Seek Help to Make Your Decision

While estate planning can be daunting, it does not have to be. I can help guide you through this process. I can explain your options and advise you on the best plan that will follow your wishes while at the same time meeting your family’s needs.

Published in AAC