Estate Planning For Families

by Jun 14, 2022Article

Estate planning is something that may not be at the front of most people’s minds until they get older, but there are many reasons- aside from the obvious estate tax exemptions- why you should start thinking about estate planning if you have a family. If one person in a couple dies, it is common for the couple’s assets to go to the surviving spouse/partner, and then that person takes care of the assets and does what’s best for the children. Florida family law has what is known as “commingling” of assets, which means that if the surviving spouse inherits assets and later remarries and puts any marital funds from the new marriage into the same account with the money inherited from the previous spouse, all of the inherited funds can then be converted to marital funds. While this is fine in many cases- the surviving spouse keeps providing for themselves and their children, there may be a problem if the spouse gets divorced from their new partner. Half of these marital funds- including the inherited money- may end up going to the new spouse during the divorce as the default result unless there is a specific plan in place. This is why it’s important to start estate planning early if you have any sizable assets to protect your assets and your family.

Asset Protection Basics

One estate planning option is to leave assets to the surviving spouse in a trust. The trust can specify that the surviving spouse can access the funds for him/her and the children, but the assets are held by the trust rather than the surviving spouse so they can’t go to the new spouse in the event of divorce. This type of planning is known as asset protection, and also protects against several other kinds of risks. For example, if the surviving spouse inherits assets and then causes an accident, or gets severely injured, these funds can be recovered by somebody who gets a judgment against them. Many assets are not protected from creditors, who can seek to “execute” against inherited assets to recover a judgment. Asset protection offers a barrier against such recovery. Parents can also use this kind of planning for adult children, even while the parent is alive.

Funds In Trust For Minors

If funds were passed to children under legal adult age, some parents may want to have the funds managed by a trustee. They may also not want all of the assets going to the child right when they turn 18, but rather than them managed by a trustee. Moreover, there are asset protection reasons to keep the assets in trust, even if the adult child ends up being the trustee. Florida law allows the adult child (under certain requirements) to let the adult child be the sole trustee and have control over the funds for investments, along with access to the funds for personal use based on an “ascertainable standard” while preserving asset protection. 

Planning For Your Children

Another aspect of estate and life planning if you have children is the care of the children if something occurs to both parents. If both parents are killed or incapacitated, difficulties arise as to who is authorized to care for the children. By appointing a “Pre-need guardian,” you can protect your children’s wellbeing in the case of a disaster where you and your spouse aren’t there to take care of them. 

Contact Us Today

Estate planning is an important part of protecting your assets and ensuring the financial wellbeing of your family. Swickle & Associates is a top family law firm in Fort Lauderdale. Call Swickle & Associates to speak with an experienced family law attorney today.