Most families with young kids put off death, emergency and guardianship planning because it just doesn’t seem that urgent.  You are young, it’s unlikely you will die tomorrow right?  But as a result, if you die, or an accident puts you in the hospital long term, your lack of planning abandons your children to strangers. Your kids, who depend on you for everything, will be left to the state to decide who takes care of them and how they get access to your money – and this process could take months or even years. It is for this reason that every family with young children, no matter how old, no matter how much money you have – needs a Child Protection Plan (a comprehensive estate plan including  long and short term guardianship appointments and emergency plan).

 

If You do not Create a Child Protection Plan: Your Children Become “Wards of the State” if Something Happens to You

The title of this section is not there to alarm you.  It is there to inform you of a real threat.  Your family is vulnerable, really vulnerable – because you are the least likely age group to have any type of plan in place for death or incapacity.  Why would you be thinking about dying? You are busy living! You have work, sports practice, dance class, a new puppy, math tutors, you name it, life is cruising at top speed.  But as a parent of young kids it is essential that you pause for a moment and understand how at risk your family is because you are all young.  Children under 18 who lose their parents, who do not have an appointed legal guardian must go to temporary or long term foster care until an appropriate guardian is found for them.

Think about all of these scenarios – if you are a single parent and you do not pick your child up from daycare because you are in an accident, your small child isn’t going to know to tell their teacher to call grandma.  If you and your spouse go out on date night and do not return home, who is the babysitter going to call if your entire family lives across the country?  If you are in the hospital, unconscious in the emergency room, how do the first responders know that you have children at home?  They do not know unless you have a Child Protection Plan in place.  And as a result, in that situation where a blood relative isn’t immediately obvious, your children will be put in foster care until a suitable guardian is found.  Can you imagine how scared they will be?  They do not know where you are or what happened, and they are left with strangers, and no one they know to advocate for them in the legal system.

You wouldn’t leave your child alone on a street corner with no phone or money would you? Unfortunately, not having a Child Protection Plan in place is like doing that, because if you die your child is left on a proverbial street corner with no means of communication or access to money.

Children under 18 have No Voice in the legal system because they are not yet adults.

A child under 18 is just that, a child, according to the law.  As a result of being considered underage aka a “minor,” they have no rights in the legal system and they become what is called a ward of the state if a parent or guardian is not there to advocate for them.  This means a representative MUST be appointed to advocate for their best interests, because they cannot speak for themselves.  Now imagine if you have a 3 year old?  They definitely cannot speak for themselves, or even try.

 

Luckily, by working with an experienced estate planning attorney, a family can very easily set up a Child Protection Plan and appoint long term and short term guardians to advocate for their children in case of emergency or death.  Further, by setting up that guardianship plan, along with an Estate Plan that includes a Living Revocable Trust – your children’s future will be safely secured in case you are not there.

A Living Revocable Trust is an essential element of a Child Protection Plan because it puts your assets into a protected container (I call it a Treasure Chest) that is immediately accessible to your children via the Trusted Person (i.e. the Trustee) you chose to give the keys to.  The Successor Trustee is the guardian of your assets for the children in the legal system. And just like the appointment of their physical guardian, you must choose a guardian for your money because children cannot inherit or manage money because they are not adults, and have no rights in the system.

By creating a Trust  (i.e. putting your assets in a Treasure Chest) all of your resources are immediately available to the children and their chosen short or long term guardians in case of an emergency. If you do not have your assets in this Treasure Chest, all of your assets will have to go through a process called Probate Court before they are available to the children and their appointed guardians.

 

What Tragedy Can Look Like Without a Child Protection Plan in Place

Now, here is a story that has happened – two parents die in a tragic car accident, and their young three year old child is at home with a nanny.  The grandparents and aunt live across the country and the dead parents did not have any guardianship or estate plan in place.

The nanny doesn’t have access to the parents phone or computers so she doesn’t know how to call the grandparents in Arizona, or the aunt in Ohio.  The 3 year old child is scared and doesn’t understand why her parents are not home yet, and after many hours the nanny must go back to take care of her own family.  The nanny calls the police for lack of any other options.  She can’t take the child home with her because that would be kidnapping, and she has no right to actual custody because she isn’t an appointed guardian.  The police investigate the situation and call child protective services to come and get the three year old.  Child protective services places the child in temporary foster care as they investigate what happened to her parents and who the next of kin (blood relatives) are.  It takes five days to determine that the parents are dead and where the child’s nearest family are.  As soon as the grandparents know that something has happened, they fly out to pick up the child from foster care – but meanwhile the child is traumatized, and the hardship to the survivors has only just begun.

The parents did not have any type of estate plan in place.  No will, no trust, no instructions regarding their assets or liabilities – the grandparents do not even know where the family’s bank account is.  They do not know how to find any way to pay the mortgage.  Meanwhile, the child has no means of support besides her grandparents are retired and live on a set social security income.  The grandparents are not prepared to pay for a small child and a household without additional income.  And they do not know where their deceased son’s money is, nor can they access it even if they did know.  Also, there is no life insurance, because the child’s parents never got around to purchasing any, and none was offered through work.

The grandparents have to hire a private investigator and a probate attorney to help them get access to the bank accounts and other assets.  The probate attorney tells them it is going to be 9 months to a year before the court makes a decision about anything, and in the meantime a guardian and a financial custodian will need to be appointed for the child.  The family’s money is still locked up in the bank, and the mortgage company sends letters because they haven’t been paid.  The grandparents are overwhelmed and they do not know what to do, and as a result the house will be foreclosed on.  Meanwhile, a custodian is appointed to represent the child’s best interests in the court process because it is determined the grandparents, who have a bad credit history, are not fit custodians of the child’s potential inheritance.  So now, the grandparents have to petition the court to get access to funds to take care of the small child, and pay the court fees for the appointed financial custodian.

Finally, after two years the probate court determines that the aunt will be the best guardian for the child and is capable of being the best custodian for the child’s inheritance long term.  However, by now the house is gone via foreclosure sale, and most of the deceased family’s savings is owed to the court or the lawyer for the probate and guardianship proceedings. The grandparents are overstressed, their health is failing because it was all so hard for them to manage, and they are still wracked with grief at losing their son and having “failed” in serving their granddaughter.

 

This scary story is 100% preventable with Child Protection Planning and Comprehensive Estate Planning

I didn’t tell this story to freak you out, or to create drama.  It is just a clear demonstration of the multiple levels of preventable tragedy that can strike if a young family has no plan in place.  Working with an experienced estate planning attorney to create a Child Protection Plan and comprehensive estate plan will avoid it all.  In a matter of weeks you can have a plan set up that not only protects your family in case of emergency by appointing long and short term guardians, but it also ensures that all of your assets are immediately available to your children and family with absolutely no court involvement.

 

What does a Comprehensive Child Protection Plan and Estate Plan Include?

Here are the basics of a comprehensive plan:

1. Long Term and Temporary Guardianship appointments for your children
2. An Emergency communication plan and wallet cards for first responders
3. A Living Revocable Trust
4. Financial and Medical powers of attorney for you and medical powers of attorney for the children
5. Life Insurance
6. Asset Inventory
7. Proper practical planning to ensure all of your assets are appropriately titled in the Trust, and that you have the right beneficiary designations on all of your accounts and life insurance.

 

What do I do if I do not even know where to start estate planning or child protection planning?

You can click the link below and book a 15 minute call with an experienced estate planning attorney who focuses on child protection planning with busy parents.

All you have to do is book the phone call, and our firm will lead you through the process to ensure you have a plan that meets your family’s unique needs within a matter of weeks.