What Is Micro Estate Planning And Do You Need It?
As a dedicated Forbes reader, you are probably already familiar with the virtues of traditional estate planning – you can lower your taxes, eliminate probate fees, and provide peace of mind and security while you are living and provide for your heirs. If you haven’t already done this type of planning, now would be a good time. It doesn’t have to be complicated or expensive. The important thing is to get started by calling an estate attorney, or if you are budget conscious, look for online resources at the very least.
While the benefits of this kind of long-term planning cannot be overemphasized, you may not be familiar with “micro estate planning.” Actually, I’m sure you aren’t because I just made that term up! What is micro estate planning?
Imagine you have a young child and something happens to you and your spouse. With a traditional estate plan, you might have a will that includes language about guardianship. In the event you and your spouse pass away or are incapacitated, it is in this section of the will the court will turn to that will ensure your guardian of choice will take care of your children until they reach adulthood.
The keywords here are “court” and “long-term.” Traditional estate planning is sufficient for establishing long-term guardianship, but what happens in the hours or days after your passing? Enter micro estate planning.
If you and your spouse go out to dinner but don’t make it home, who should the babysitter call? If the police show up at the front door, who should they call? I recently interviewed a passionate couple who have considered these scenarios and who have taken steps to minimize the trauma. They worked with Orange County, California estate attorney Darlynn Morgan who helped them draft a separate legal document with explicit instructions about who should be called and who should take the kids in the short-term – before legal guardianship is transferred and established. The family has this document as part of their estate plan binder, but they also put a copy on their refrigerator.
I have a young daughter and the nearest family might be as far as five to 24 hours away. Where would she go during that time? I would want her to go to a neighbor’s house, but would the police hand her over to them without any documentation? Probably not. Morgan confirms, “If there is no one with clear legal authority the police must call in child protective services (CPS) and the child will go into their custody.”
I don’t know about you, but in the aftermath of learning that her parents were both killed, I certainly would not want to compound the trauma for my child by having her whisked away in a police car to a facility where she is greeted by strangers. No. I would want her to go to our neighbor’s house where she has had many sleepovers and be in the company and comfort of friends until her long-term guardian can take over.
If you have underage children, ask your estate attorney about adding a separate document to your plan that protects your children when they need it the most.