Case Study: Guardianship choices

Mom and Dad are recently divorced and have a Daughter, age 5, together.  The custody arrangement is that Mom has primary custody during the week and Dad sees Daughter on the weekends.  Mom is interested in putting together an estate plan, including naming a Guardian in the event that she were to die.

This is a common scenario these days.  A guardian should always be named in an estate plan where an individual or a couple has minor children.  But what happens when two people are divorced?  Who should be named guardian then?

First, in the scenario above, if Mom were to pass away while Daughter was a minor, Dad would be the preferred choice of any court deciding a guardianship issue because he is the biological father.  He will be the favored choice.  But…Mom should still name someone in her estate plan to be guardian in the event that Dad is somehow unfit to be guardian if Mom was gone.  Common examples of why he might be unfit would be substance abuse problems, incarceration and mental incapacity.  So just in case, and most importantly, to give Mom peace of mind, she should name someone to serve as Guardian for daughter in the event Dad could not.

A good estate plan for Mom would then include a will (perhaps with a testamentary trust) and/or a living trust, including a guardianship designation, a healthcare power of attorney, a healthcare directive, a durable power of attorney for finance and some probate avoidance planning, either by completing beneficiary designation assets (referred to as nonprobate transfers), or in the case of a trust, by changing the titling of assets to reflect ownership by the trust.