Partners in Civil Unions and Marriages Still Need Planning--Part III of VII

The common problem hetero, gay and lesbian couples will all face is what happens to their property and children if they do not put their plans in writing? We’ve already seen that marriage is not a magical cure that eliminates the need for legal planning. The law is also deficient in handling the vast majority of property distribution plans when it comes to children’s ages.

Because the age of majority is 18 for just about everything except drinking alcohol, that is the age children receive any inheritances free and clear. Let me ask a question for those of you in their 30s or later: what would you have done at age 18 if someone suddenly gave you $500,000? Here are some of the most frequent phrases I hear from clients: “Hummer,” “Vegas,” “Cabo,” “party 24-7,” and “Shop ‘til it’s gone.”

After discussing these issues with my clients, most agree that 25 is a better age to start giving control of a larger inheritance, and some clients choose to spread the inheritance out over two or three payments. It is fairly common for my clients to give one-third at 25, another third at 30, and the rest at 35. Until those ages, a trustee who they appointed handles investments and paying expenses for the beneficiary. Without planning, the beneficiary gets everything at 18.

In the 11 years I have been practicing law, only once was I comfortable with 18 as an age of inheritance. That was when the couple’s 16 year old daughter called to book the appointment, called to follow up to make sure that her parents had kept the appointment, and after the documents were signed followed up to make sure that we had a copy of all of the documents in case her parents misplaced them. I also found out when discussing issues with my clients that their daughter, at 16 years of age, already managed all of the household bills and expenses, balanced the checkbook, and made sure their taxes were filed on time. In the 11 years I have been practicing law, I have also not come across parents who were equally confident in their minor child’s ability to handle finances. Next, we’ll take a look at what happens if an irresponsible and young John Doe inherits property from his parents Jane Doe and Janet Roe if they do not plan ahead.