Janssen Law, PLC

Should you name a guardian to head your child’s trust?

As you make preparations for your child’s future, you may have already designated a person to be a guardian for your child in the event you and your spouse are incapacitated or pass away. You might also be considering setting up a trust for the child and are looking for a person to be an Iowa trustee. Then it hits you: why not name the person that would be your child’s guardian as the trustee? It seems like a logical step, but you should be careful as you consider this choice.

At first glance, naming the guardian to oversee your child’s trust appears to be a wise move. If you trust a person to take care of your child, then you likely would not see a problem handing that person responsibilities over your child's financial inheritance. In some cases, a guardian can make a good trustee. However, in other instances it may be prove to be a problem.

For one thing, a trustee must be able to make financial and legal decisions concerning the trust. The FamilyConnect website warns that a guardian might not possess the skills necessary to handle a trust. If a trustee mishandles a trust and deprives the beneficiary of the trust of some or all of the assets, the trustee could be sued or held liable for the loss. You should make sure that a guardian is competent enough to handle a trust.

Additionally, naming a guardian as a head of a trust gathers a lot of power in the hands of a single person. While some people might be trustworthy enough to handle both guardianship and trusteeship duties, it is possible that a person with that much authority could abuse it. Think about whether your child’s prospective guardian can handle the sudden responsibility of overseeing money. Could that person resist the temptation to abuse the authority of a trustee?

On the other hand, naming a different person to be a trustee can form a kind of committee that oversees your child. Power is split between a guardian exercising welfare responsibilities over your offspring and a trustee that takes care of the finances. With this arrangement, you have two people working in tandem to care for your child. This also offers accountability, as each person can monitor the actions of the other person.

Please be aware that while this article offers information on guardianships and trusts, it does not offer any legal advice.

 

No Comments

Leave a comment
Comment Information

The determination of the need for legal services and the choice of a lawyer are extremely important decisions that should not be based solely upon advertisement or self-proclaimed expertise. This disclosure is required by the rule of the Supreme Court of lowa. A description or indication of limitation of practice does not mean that any agency or board has certified such lawyer as a specialist or expert or more competent than any other lawyer. All potential clients are urged to make their independent investigation and evaluation of any lawyer being considered. This notice is required by rule of the Supreme Court of lowa. Any information provided as a result of receiving a response to this website should be considered general in nature and no personal legal advice will be provided without first establishing an attorney/client relationship.

700 Second Ave.
Suite 103
Des Moines, IA 50309-1712

Phone: 515-421-9068
Fax: 515-274-1364
Map & Directions