Guardian = ‘legal parent’
If you and your spouse passed away, or are mentally, physically, or legally unable to act as parents, a court will appoint someone to act as the child’s legal guardian, to make decisions regarding the child’s welfare, health, education, and basic finances.
Why should you choose a guardian?
The guardian will act as the parent for your children. Any child without parents must have a guardian. If you do not choose a guardian, the court may choose a guardian unrelated to your children, who will be paid out of your children’s assets. Or worse, your relatives may end up fighting over the right to raise your children.
The guardian you choose will have the responsibility to raise your children according to your desires. By making a choice, you can ensure that your children are raised with the standards and teachings that matter to you.
How can you choose a guardian?
The simplest way is with a will naming the person you want as guardian. For married couples, each spouse should have their own will naming the guardian. The will for the last living parent will decide who becomes guardian.
Conservator = ‘financial manager’
If the children will be left significant property or finances, the court may appoint a conservator to handle those assets. The conservator can be the same person as the guardian, but does not have to be.
Why should you choose a conservator?
If you have significant savings or property that would pass to your children, a conservator would likely be needed. You may not think your children will need a conservator, but your retirement savings, life insurance, or home can add up quickly. A conservator will definitely be needed if any real estate will be left to your child.
The person you trust as a guardian may not be the best at handling money, or you may have a sibling who understands finances, but is unable to act as a parent. Appointing a separate conservator can also reduce the burden on the guardian.
How can you choose a conservator?
Just as with the guardian, you can name a conservator in the same will for each parent.
Trusts = ‘rules for protecting your children’
Trusts have many uses; distributing assets, protecting property, preserving wealth, avoiding taxes. But when it comes to your children, a trust can be vital to preserving your estate until your children are old enough to manage their own finances. A conservator has the responsibility to manage your children’s assets. A trust sets the guidelines for how those assets should be used for your children’s benefit.
You can’t predict the future, but with the right planning, you can preserve it for your loved ones.