Minor Children & Probate
Most people fail to make adequate provisions for their children in the event of their death. Parents think they can name a guardian informally or in their will and that this "nomination" will allow an individual to function as their children's guardian until each child reaches the age of majority. Unfortunately, nothing could be further from the truth.
When your estate is admitted to probate, the court must appoint a guardian
for your child. If you nominate a guardian through a provision of your will
or an independent instrument, the court may accept your nomination or it
may not. The court may appoint a third party to be the
guardian of your children or may split the appointment
between a number of individual who may serve as either "guardian of
the person" or "guardian of the estate" for any one or number
of children.
Even if your nominated guardian is accepted, it is important to remember
that the court, not the guardian, will retain control over the children's
estate. The court will require annual accountings (at a minimum) and may
require a bond to be filed by the guardian. Bonds are expensive and increase
in cost with the size of the estate.
If your spouse is living after your death, the court may still require appointment
of a guardian. This requirement may be triggered by the court (by the court's
own initiative) or by a relative or third party who makes a petition to
the court. The guardianship proceedings are costly in an economic sense
but can tear families apart from an emotional perspective. Moreover, all
of the guardianship proceedings will be public, exposing your family to
scrutiny during a time of grief. In short, the guardianship proceeding is
not a pleasant process.
Some people think they avoid guardianship concerns by including a children's
trust in their will. Unfortunately, because it is part of a will, the children's
trust can only go into effect after the will has been probated. As
a result, the court must still probate the will and include the appointment
of a guardian as part of the process. It could be months or years before
your children receive assets under the children's trust. If the children
need economic assistance for their care and support, they must maintain
a petition for expenditures through their guardian. If you become physically
or mentally incapacitated, you are still alive, so your will cannot be probated
and the children's trust cannot go into effect. No beneficiary proceeds
can be paid because no one died.