"Take time to create a plan to build generational wealth in your family."
What happens to the life insurance money you have planned for your children in the unfortunate event that you pass on without an estate plan? Though you may believe your finances will be allocated to your offspring by surviving family members who love them . . . think again. One or more of the following scenarios could easily happen to you:
Scenario #1: You are married, you pass on, and you are confident that your spouse will use the funds to provide adequate education funding and future financial security for your children, right? Well, what if:
- your spouse gets married to someone else who convinces him/her to do something else with the money
- your spouse gets into it with the kids and decides to do something else with the money (YES, it happens)
- your spouse goes into a state of depression after your passing that prevents him/her from making sound financial decisions
- your spouse simply doesn't have the financial acumen to make the money grow and as a result, even though his/her heart is in the right place, the money dwindles because of a few "novice" investments.
Scenario #2: You are not married, you pass on, and you DO NOT want your "ex" to obtain guardianship of the child(ren) and certainly not the money, right? Well, what if:
- your ex gets the child(ren) and blows the money on the kids by buying them everything they want (and everything he/she wants) and there is no money left for college (the fact that you didn't like him/her, or even if he/she is immoral in your opinion would not, alone, be enough to prohibit a judge from granting guardianship AND control of the money)
- your ex gets the child(ren) and blows the money on other people (new love interest, or worse, the new love interest and his/her children) (YES, you know it happens!)
- your ex gets the children(ren), blows the money, then neglects the children after there is no use for them any longer. (SAD, but you you never know who will fall into this situation)
So how do you protect yourself and your children's financial future?
You need a firm ESTATE PLAN in place to ensure that the money is appropriated in accordance with your wishes. A solid estate plan would not only designate who will inherit the assets and financial benefits of your estate, but it will also state who controls the money (preferably an objective third party or financial institution), how much money is dispersed, and when that money is dispersed. Moreover, conditions can be attached to ensure that your legacy creates financial stability for future generations (for example, 20% is disbursed when my child receives her high school diploma, 20% is disbursed when she receives her college degree, each grandchild gets 10% upon high school graduation, etc.).
So what are you waiting for? Get busy protecting your children's future. Otherwise their fate is in the hands of the surviving guardian. Beware!
God Bless,
Attorney Deadra Woods Stokes
Your Wealth Counselor
