Life insurance policy: What is it? Do you want one?

I have tried to make sure that my children are well taken care of in the event of my sudden death. The last thing in the world I want is for my careful plans to fall apart. I want my children to have the safety net that I create for them.

If you have life insurance with minor children, you need to understand the trustee’s responsibilities in relation to the benefits you want to provide to the survivors.

Choosing a manager is part of planning for the unexpected.

A trustee is a person (trustee) who will oversee the distribution and custody of any financial assets designated by, for example, life insurance or a will, to a minor.

It’s a big responsibility, so knowing the role of the manager and how to choose the right one can seem difficult… that’s why we’re going to explain more about this important process.

What is a moderator?

A Trustee is someone who protects, protects, or manages (not all that different from a Trustee if you’re wondering…) financial assets. In terms of insurance, the trustee’s role is to “safeguard and preserve” any assets left to your minor until he or she reaches the age of majority. For example, when a person applies for a Haven Term policy, if they indicate that the beneficiary is a child, we require that a guardian be named. After your death, when your child reaches the age of majority, the guardian must give the property to the child. The age of majority (sometimes called “coming of age”) is 18 in most states, but can be as high as 21.

Most positions come with nine-letter words. Consider these powers held by a manager:

  • Contribute financially to the child’s benefit (for things like education, tuition fees, medical expenses, etc.).
  • Transfer the entire custodial account to support the minors (this is also called a “fiduciary” relationship).
  • Buy stocks, mutual funds, bonds, or other securities on behalf of the child

How is a manager different from a supervisor?

Although they may sound similar, there are significant differences between the role of a manager and a manager. A guardian acts as a surrogate parent (if both parents are deceased) and is often named in a will. The guardian must have the right to take care of the minor, so his authority extends to the payment of the policy. It is possible to name a person as a guardian and guardian.

When do you call a supervisor?

You need a guardian when you have small children and belongings that can be given to them.

Under some state laws, a minor cannot legally own property in his or her own name. This becomes difficult when you name a minor as a beneficiary under a life insurance policy or in your will.

If you have minor children, an executor can help you make sure that insurance money or other inheritance benefits (especially from a will) can be transferred according to your wishes. The Uniform Transfers to Minors Act (“UTMA”) allows money left to a child to be held by a guardian until the child reaches adulthood.

One important point that is often overlooked: even if there is a surviving parent, he or she does not automatically take care of you for the purposes of your life insurance, even if he or she is named as the guardian of that child in the will.

What happens if you don’t name a custodian?

Maybe you don’t want to hurt your family or not. Wouldn’t it be easier not to choose anyone? The short answer to this question is no. While some may not be comfortable making decisions, failing to name a supervisor can have negative consequences.

If your minor child is named as the beneficiary of an insurance policy or other property, and you have not appointed a guardian, your child will not be able to access the property until he or she reaches the age of majority. These results are exactly the opposite of what you want when you decide to buy insurance or leave things for your little one, right?

Another consequence of not naming a guardian is that the court may appoint a guardian for your child and allow the guardian to be the guardian of the property. No one wants this because it is time consuming and expensive, leaving the difficult decision to the courts.

Who would you name as a supervisor?

Now comes the (potentially) difficult part for a parent: choosing a caregiver. As you look at the role of the guardian and the importance of that person’s role in your child’s life, this is no small decision.

Your choices are personal, and as unique as your family. However, some tips can help in choosing a supervisor. But it all starts with one word: Trust. Do you believe that this person has a responsibility to take care of such valuable things as your child’s well-being?

A number of followers can immediately remember. So, here are a few questions you can ask yourself (along with your partner) to help narrow down the list: Is this person financially savvy? Will he be comfortable providing financial advice and handling financial decisions on behalf of your child? Does this person have enough time to take care of the responsibility? Is your elected official looking for a position? Some don’t, and it’s good to know that up front.

How to ask someone to be your child’s guardian

Well, it’s time to ask a question. How do you ask someone to be your child’s guardian? After all, accepting a position is as big a decision as choosing a supervisor.

Asking someone to be a moderator is not a simple question. It’s best to be specific here. With something this important, make sure you’re clear about what you’re asking, what it means, and why you’ve chosen this person. Need a script? How about this:

“Alice, Mike and I have something important to ask you.” We’ve given this a lot of thought, and we want you to consider serving as a babysitter for Bobby and Cindy. This means that if Mike and I die before Bobby and Cindy turn 18, you will be responsible for managing the money we leave to them until they are adults. We are asking you because we trust you, we know you will do things in the best interest of children, and we know you understand how to use money. We know this is a big deal, so please take the time to think about it. “

Not difficult, right? Be prepared to answer questions and wait a bit for an answer. Oh, and, you know, use your own name and that of your real children.

What do you call a supervisor?

The process of naming a life insurance agent is simple. Once you advise your life insurance provider that you want to name a custodian and set up a custodial account under the UTMA, the company will provide you with the appropriate forms. Your estate planning attorney can help you with security issues related to certain properties.

It’s a good idea to review your choices from time to time. Circumstances may change, and you may no longer want your chosen carer, or that carer may no longer want the role. Or perhaps the older child has reached adulthood and you would like him to be the guardian of his younger sibling. Whatever life throws at you, consider how it will affect your choice of manager and update/review your plan regularly.

Today’s planning is tomorrow’s peace of mind

A big part of being a parent is making sure your children are loved, cared for and safe at all times. That’s why you’re thinking about life insurance. And maybe the will. And that’s probably why you just took the time to read this. Now that you know what a manager is, how they work and how to choose one, you can go ahead and relax. I’m just saying, you have children under the age of 18. You won’t be resting for a decade or two.

About Raquel D’Apice

Raquel D’Apice is a humor writer and author who maintains a parenting/humor blog called The Ugly Volvo. She lives in Jersey City with her husband and a 10-year-old son who keeps grabbing at her laptop.

Read more by Raquel D’Apice