The birth of a child is what prompts many people to begin to think about estate planning — at least to choose a guardian to care for that child if both parents were to die. Parents are typically most concerned with finding a person (or perhaps another couple) to raise their child. In legal terms, that’s known as the Guardian of the Person.
In many cases, that guardian is also designated to be responsible for managing any money that’s left in the parents’ estate plan to care for the child and to ensure that it’s spent in a responsible manner to cover the child’s living expenses, education, medical care and other needs. That role is known as the Guardian of the Estate.
However, you may prefer to give these responsibilities to two different people. The Guardian of the Person and the Guardian of the Estate don’t have to be the same person.
Why choose a separate Guardian of the Estate? If you are leaving a significant amount of money to your child, you want to ensure that it’s invested and managed wisely. The person whom you believe can best raise your child may not have the knowledge, organizational skills and/or desire to manage a significant amount of money or a complex mix of assets.
If you choose separate people for these roles, however, it’s essential that they be able to work together to do what’s best for your child. The two guardians will need to communicate with one another regularly, trust each other and work together to provide for your child as you would have wanted.
You may not think you have enough assets to warrant a separate Guardian of the Estate. However, remember that if you and your spouse are killed in a car accident, plane crash or in some other manner that warrants a civil lawsuit, your child could end up with a considerable amount of money thanks to an award or settlement in that case.
If you’re debating whether to choose two separate guardians for your child or to ask one person to assume both guardianship roles, it’s wise to discuss the matter with your estate planning attorney. They can provide valuable information and guidance.