Many times parents will ask me, “How do I choose a legal guardian and how should that person handle the money?” And my response is, “Before you choose a guardian, you have to really know and talk about how you’re going to raise your child or your children.”
And that really comes to what people are calling today an ethical will is if you’re not here, how do you want your children raised? So once you and your spouse talk about that and you figure out how you want your children raised, then you know who you want to raise them. And a legal guardian could be a family member, can be a friend, it’s a very personal choice that they have to also accept when you ask.
Make sure you review it every five years, because somebody who you select as a guardian when you have a newborn five or ten years from now, you may think, “What was I thinking by selecting my best friend that’s no longer my best friend?” So you really want to review these every five years or so.
Also a question comes up is, “Should that same person handle the money? The life insurance proceeds?” And I usually suggest, no. It should be some other person, a trustee, that handles your money and a guardian that really cares for your children. You don’t want a situation where there is a conflict, so it’s usually best to have a trustee handle the money, invest the money and a guardian who cares for your children.