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Leaving Assets to Minor Children

All parents want to make sure their children are taken care of financially in any circumstance. To that end, they update their wills, name guardians and designate children as beneficiaries on life insurance policies.

These are all great steps to take, but parents often don’t realize the legal process that is set in motion upon death when minor children are involved.

Going to court

In the absence of a trust, inheritances to minors must go through a probate court proceeding upon death. In the probate proceeding, the judge appoints a guardian to raise the child. This is typically the same person named by the parents in their last will and testament. Many people are surprised to learn that the court is involved until the age of majority, at which time the child receives the assets.

Depending on the size of the estate, that lump sum could be overwhelming for an 18-year-old to handle. Also, probate is a matter of public record, meaning that anyone will be able to see what was owned and who is receiving it.

The same court requirements apply if minor children are named as beneficiaries on life insurance policies or other assets.

Establishing a trust

A more efficient method of leaving assets to a minor beneficiary is to create a trust. A trust allows you to control when the child receives the funds, for what purposes they can use the money and who will manage the assets.  Generally, there is no need for court intervention.

Depending on how the trust is drafted, it may also protect your children’s inheritance from lawsuits, creditors, bankruptcy and divorce settlements.

Establishing a trust ensures that your children or grandchildren will receive the assets you want them to have at the age you determine is best. A trust doesn’t have to be complicated, and it may save time and money by preventing court proceedings.

Tracey Courtney-Arnall can be reached at 865-766-3067 or by email at

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