Estate Planning: It’s not just for your Grandparents

By Brook J. Bisonet

  One of the most uncomfortable thoughts for parents is what will happen to their children if they were to unexpectedly die or become incapacitated.  The unpleasant feeling this thought evokes often prevents parents from addressing the issue.  These feelings can push the issue aside with the intention of dealing with it another day.  Ironically, discussing and creating an estate plan, while uncomfortable at first, can put your mind at ease once you develop a plan because it provides a measure of certainty. 

  While this article begins by providing information about what happens to your children and assets if you die without an estate plan, I hope that the remaining information puts your mind at ease knowing that creating an estate plan can be relatively painless and affordable.

  What happens if I die without a will?  This is a very common question that a lot of people have, so do not feel alone.  Typically, if you die without a will, your estate will be divided in accordance with Michigan statute.  This means that the court will appoint a Personal Representative for the distribution of your assets.  While you may not like the fact that you will not have a choice in deciding who receives your belongings and property, the problem is worse if you have minor children.  If you die leaving minor children and have not nominated a guardian, you may not get to decide who raises your children.  Upon your death, your children may temporarily become wards of the State of Michigan.  A family member may be able to request an emergency hearing with the Court so that temporary guardianship may be granted.  Temporary guardianship will last until a full hearing on guardianship can be heard by the court.  This can create a messy custody battle that can create more stress for the children and the family in an already stressful time.  The creation of an estate plan can make the transition less stressful, more efficient, and less expensive, benefiting the children and all of the family members.

  What is essential in an estate plan if I have children?  The most essential document in an estate plan is a will.  Most people believe that a will is only for the distribution of your property.  However, if you have minor children, a will should also include a nomination of a guardian for your children.  You should also create a separate document nominating a guardian for your children if you become incapacitated.  The nomination of a guardian is an extremely important part of the estate plan.  As an illustration of the importance, here is an example of how it would be utilized.  Let’s say that you, your spouse, and your two children are in a car accident.  Your spouse dies in the accident and you are in a coma.  One of your children is injured and needs medical treatment.  Who has the authority to make decisions about your child’s medical care?  If you have previously nominated a guardian, upon acceptance of the appointment by the nominated person, the decision will be made by the person you have selected.  Otherwise, an emergency hearing with the court would be needed to delegate that authority.    

  In addition to a will and a nomination of a guardian, other desirable documents include a Patient Advocate Designation (“PAD”) and a Power of Attorney (“POA”).  A PAD allows you to outline your desires regarding medical treatment if you are incapacitated and gives you the opportunity to select a person who will make medical decisions for you and follow your wishes.  The POA allows you to select a person who will make financial decisions on your behalf if you are incapacitated.  These are highly recommended documents for any estate plan and provide you the opportunity to detail how you want medical and financial decisions made when you are not able to make those decisions.  An essential estate plan is relatively, and surprisingly, inexpensive.

  In addition to the essential estate plan, our firm can provide guidance on creating a trust for the benefit of your minor children.  While not essential to providing guardians and care for your children if you die, a trust can be a tool to provide financial support for your children.  It also allows you to control how much money the children receive and when the children can receive that money.  The trust can be funded with your remaining assets and/or a life insurance policy.  In addition to using the trust as a tool to provide financial support, a trust is beneficial in avoiding probate.  If a more extensive plan is needed or desired, we can provide a plan that goes beyond the essential estate plan.  Every plan we develop, from the very basic to the very complex, is carefully tailored to the particular client’s desires, situation, and needs.

  Articles are designed to provide general information of interest.  Articles cannot substitute for in-depth legal analysis of your particular problem. Readers are encouraged to seek counsel regarding individual situations.