Can I skip a generation in my estate plan?
At times, circumstances arise requiring a grandparent step in to raise their grandchild. The U.S. Census Bureau estimates that over 2.4 million grandparents have custody over their grandchildren in the country today. Grandparents raising their grandchildren will face many challenges and reap many rewards. One of the greatest concerns of many older caregivers will be ensuring their grandchildren are financially cared for after their death. At times, it may be necessary for a grandparent to direct their assets directly to their grandchildren, essentially skipping a generation. With so many considerations, it is critical that grandparents raising their grandchildren contact an experienced estate planning lawyer.
Naming a Caregiver for Your Grandchildren
If you have been legally named the caregiver for your minor grandchild, it is critically important that you name a guardian for your grandchild in the event of your death. Your grandchild has likely already experienced the difficult process of losing his or her biological parents, whether it be through death, abandonment, or removal by the court. If you die without naming a guardian, the court will be forced to appoint a caretaker. Do no leave matters to chance; create a will that selects a qualified guardian for your grandchildren as soon as possible.
Consider a Trust
At times, grandparents will end up raising their grandchildren due to the parent’s, their child’s, death or incarceration. Other times, the parent has a drug or alcohol problem, mental health issue, or another personal problem that prevents the parent from being able to care for the grandchildren. Grandparents who are financially supporting their grandchildren will want to ensure their grandchild is cared for after their death. Where there are concerns that the parent cannot be trusted to receive funds, the grandparent may need to skip the parent in his or her estate plan and transfer assets instead directly to the grandchild.
A trust is often the best method for grandparents to provide financially for their grandchildren upon their death. With a trust, the grandparent can set up distributions for the grandchild to receive assets as they reach a certain age. A trustworthy trustee can manage the assets until the grandchild attains the predetermined age. Further, a trust gives the trust creator complete control over who receives what assets. Contact an estate planning lawyer for more assistance with crafting an estate plan to protect your grandchildren today.