Home Loans Help: Insurance Tips

Who will be their Guardian

If you are like most people today, you do not have a will. The reasons for this failure are many, with the most common being along the lines of “I don’t have enough assets to worry about”, “I don’t know how to write a will”, or “Lawyers charge a lot of money”.
Here’s my answer to the last two – buy a software package that helps you draw up your own will and follow the forms. This software will ask you a series of questions and you supply the answers. When you are done, you have a piece of paper ready to be signed; witnessed and placed somewhere it can be found in the event you die.
As for your lack of asset objection, that might be true if you live in a cardboard box, with only the clothes on your back, as the last surviving member of your family. If this does not describe you, than you do have assets and you really should make preparations for dispersing them when you die.
As you can tell from the title, this is not about your will except to relate as to why everyone should have one. Instead, this writing is about your children. If you are childless, keep reading because someday you may have children. If you know you will never have children, keep reading because someday you may be able to use what you learned here in a discussion with someone who has children.
The biggest reason everyone who has children must have a will is because of the children’s guardian. Essentially, a guardianship is an institution created and administered by the court, making the guardian a court-appointee. However, when you name someone to be a guardian in your will, you make it difficult for someone else to be appointed. If you don’t name a guardian, a judge will decide who will raise and nurture your children. Most likely, this judge does not know your family, nor does the judge really have the capability to know if any of your extended family members can properly raise your child.
It is impossible to stress how important it is for parents who die early to find the right people for the guardianship job. They will be responsible for the upbringing of your children. You should definitely consider things like parenting skills, values, physical environment (apartment/farm), and religion.
Two important questions to ask (and the answers):
1.What if the best person to bring up your child physically is not the best manager of money? While you are planning your will and your children’s guardian, you can also plan to separate the functions of guardianship. To do so, you first write your will appointing a “guardian of the person” who will care for your children physically. Then, also in your will, you name the person whom you appoint to be the “guardian of the estate”. This person’s job is to dole out the resources so that your children are not a burden on the person or family taking care of them.
2.What if the guardian you select is over flowing with love and values, but scrape the bottom of the barrel each month to feed their own children? Everyone knows that you do certainly do not intend to add your children to theirs and cause them undue hardship. This leaves only one real solution.
Provide adequate financial resources for the guardian to properly care for your children. At the least, you should provide enough cash resources to feed and cloth your children each month until they complete high-school. Many parents also make an effort to provide the resources for their children to be able to go to college.
Most likely your own asset chart is a little short for providing the amount of cash your children will need or you want to provide after your death, consider using life insurance. Term life insurance to be paid into a trust is relatively inexpensive during the years your children are at home.
If you are leaving a trust with a significant sum of money, you may want to appoint a “guardian of the estate” to handle the finances separate from the “guardian of the person”. This can remove the obvious temptation if someday the guardian encounters personal finance difficulties.
The estate guardian and the person guardian must be able to get along, so it is important you pick the right people for these positions. Even more important is that if you do die early, your child will be brought up in a loving, nurturing home you have chosen.
After all, you wouldn’t go through the difficult issues of estate planning and guardian picking if you didn’t want the best for your children. That best includes you making out a will, and doing it as early as tomorrow.

Roger Sorensen is a Financial Author and Speaker, and the editor of Money Basics, a monthly personal finance newsletter found online at www.brighterfutures.com. After filling in his own debt pit equal to 150% of his annual income, Roger has turned the experiance into Brighter Futures, a Financial Literacy company. "There is hope for you, no matter how large your debt load might be."

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