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Am I Too Young for an Estate Plan or a Long Term Care Plan? Part 4

In this 4th post of 4, I continue to discuss the topic of a catastrophic illness or injury hitting a younger family.  We discussed the issues of long term care which may be needed for extended periods of time or for life.  Advances in medical science can save lives but a lot of care is often needed.  But, as I stated last week, many of these patients may ultimately not survive.  So what happens if someone in their 30’s, 40’s or 50’s dies without a will?

As I have written about in past blog posts, without a will the intestacy laws determine who inherits.  Most people would assume that a surviving spouse will be first in line to receive all the assets, however, that isn’t always the case.  If either the decedent (person who died) or the surviving spouse has children from other relationships, then the spouse will inherit a part of the estate but the balance will go to the children.

That’s where it can get complicated.  If any of the children are minors, then their inheritance may need to be deposited into court until age 18. At that age, although legally an adult, most people do not have the knowledge, experience and wisdom to handle what could be a large sum of money.

Alternatively, a petition to a judge to establish a trust for the children can provide protection until they reach a more mature age.  A trustee must be appointed by the judge and typically a bond to protect the assets must be purchased annually.

As I also mentioned last week, if the decedent is single and there is no surviving parent, a guardianship process may be necessary to appoint a guardian of the person and property of a minor child.  Again, this involves a court proceeding in which a judge will ultimately decide the appropriate person to act as guardian.

In each case – whether there is a need for a trustee or guardian or both – the risk is that a judge will choose a person that you would not have wanted to serve in that role.  These decisions are made by someone who doesn’t know your family but is making the best choice based on the information presented.

When I explain this reality, most people tell me they would rather not have a stranger make decisions about the care and support of their family if they can help it – which is why it is so important for even young families to have a plan in place.