The thought of your child growing up without you is enough to bring a lump to any parent’s throat. You plan to be with your children to see them grow and enjoy life, but it’s necessary to consider that something might happen to both you and your spouse.

You have hopefully planned to leave money for your children through life insurance. What about who would become their legal guardian? If you have significant life insurance and/or assets, your minor children could become wealthy overnight. How would they handle that responsibly?

They’d need help.

You can take one critical step now to empower yourself to have a say in how your children are raised, no matter what. By creating a will with a trust component, you will be able to choose who acts as a caretaker for your children, who handles their finances and how the assets should be distributed to reflect your wishes.


If you and your spouse die without a will, or die with a will that names your minor children as beneficiaries, your money doesn’t go directly to them. A court will select a guardian to oversee the money. The law determines how the money may be spent, and anything outside those parameters requires court approval. In most states, as each child turns 18, he or she will be given full control of the money.

The idea of a young person having that much responsibility scares Ruth Driscoll, director of advanced planning at Northwestern Mutual.

“Think of the emotional hurricane these children are in after losing a parent or parents,” she says. “It’s easy to get your head turned around after suffering a catastrophic life event, and that is where a trust comes in and why it can be so crucial. You can bring some order and routine into the lives of your children at a time when they need it most.”

If you’ve avoided a trust because you don’t know whom to name as your child’s trustee, Driscoll urges you to pick someone: “You can always change it, and documents can be revised. But I’d rather have a name down than leave it up to a judge to pick someone after I’m gone. You have no idea who that judge is going to pick. You, the parent, have the power, so use it.”

You can bring some order and routine into the lives of your children at a time when they need it most.


Setting up a trust or a will with a trust component to it is one way to take back some control of how your children will be provided for should you and your spouse die. A trust is a legal agreement that puts someone else (whom you can choose), called a trustee, in charge of the assets you are leaving to your children. Control of your assets is then handed over to your children at a time that you have pre-determined they should gain full access.

Driscoll adds, “It does take more time to set up a trust, but it will allow you, the parent, to decide who is going to manage the money for your children; and you can advise them how to do it as you would. The control factor is a huge benefit.” Driscoll says a trust allows you to control:

  • Whom the trustee or co-trustees would be. You can pick someone who is money savvy or capable of hiring someone to manage money for your children. This person doesn’t have to be the same person that you are choosing to raise your kids.

  • When your children will gain full access to the money you’ve left them. It doesn’t have to be at age 18 but could be at age 25 or 35, when they’ve finished college or have gotten settled in a career, etc.

  • The guidelines within which your trustee will operate. This guidance often follows something known as the “HEMS” standard, Driscoll says, meaning health, education, maintenance and support. You, as the parent, can also clarify in the trust that you want extra money released at age 16, for example, so your child may purchase a car, or at age 18 for college or for the expenses of a wedding.


Not everyone is cut out to be a trustee for your children’s money. The selection can be stressful if you aren’t sure what to look for in a trustee, but Driscoll offered these items as a checklist:

Someone who thinks about money and raising kids the same way you do — and who loves your children. This will help them provide financially for your children as you would. The trustee does not need to be the same person who will act as the caretaker for your children. In fact, Driscoll says, choosing different people for the roles can offer a check and balance for your children as they grow.

Someone who understands money management and knows when to ask for help. Trusts can involve things like investments and taxes. If your perfect trustee isn’t qualified to do these things on his or her own, you want to make sure he or she would know how to seek the help of a professional. Driscoll often suggests that a family member and a corporate trustee work together as co-trustees to assure professional money management and sensitivity to income tax consequences.

Someone who is the best choice for your kids, regardless of whether he or she is family or not. Driscoll also recommends you speak to your potential trustee to make sure he or she is up for the job.


If you’ve already taken the step of purchasing life insurance to protect your family financially, taking the next step to create a will with a trust component can offer increased protection. If you’ve been putting it off because of the expense, know that sending your child to summer camp is often more costly than creating this document.

If you’ve been putting it off because you are a procrastinator or don’t want to have conversations about your own mortality, know that Driscoll has seen more than one client tear up during the process. “But when they’re done, they say, ‘Whew!’ It’s a huge relief — because in the back of your mind you know you’re leaving a mess if you don’t take the time to have these things drawn up.” This process empowers you and your spouse to know your children will be provided for in a way that you both approve of.

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