Estate Planning Pitfalls for Single Parents: and How to Avoid Them

Being a single parent in Waco or Georgetown means you carry a heavy load and are the center of your family’s world. While you plan for their daily lives, it’s important to consider who would provide for them if you were no longer there. A comprehensive estate plan for single parents is about more than just assets; it’s about securing your children’s well-being. Without a strong strategy, you risk creating needless stress and legal issues for your children. We help you understand these challenges and build a plan that offers peace of mind and protection.

The Most Important Decision: Naming a Guardian

For a single parent, a critical decision in an estate plan is naming a guardian for your minor children. Without a will, a Texas court will decide who raises your children if you pass away. While the court will always try to decide based on the child’s best interest, the person they choose may not be who you would have wanted.

Under the Estates Code, Texas law provides a legal path for a court to name a guardian. The court will often consider the child’s other biological parent first. If that parent is not in the picture or deemed unsuitable, the court will look to other relatives. They may choose a grandparent, a sibling, or another family member. This public process can lead to family conflict and may not result in your children living with the person you trust most. By creating a will, you can nominate a guardian and a backup guardian, giving the court a clear guide to follow.

Protecting Your Child’s Inheritance

Without a will, a single parent’s assets pass to their children under Texas intestacy laws. A problem arises because a minor cannot legally receive a direct inheritance in Texas. This means a court must establish a guardianship of the estate to manage the funds. This guardianship, overseen by courts like the McLennan County Probate Court in Waco, is often costly and time-consuming, with expenses paid from the child’s inheritance. The court-appointed guardianship ends when the child turns 18, and they receive the entire inheritance at once. We help our clients find a more secure way to provide for their children.

A Better Way: The Power of a Trust

A trust is a powerful estate planning tool for single parents. Instead of leaving assets directly to your child, you can leave them to a trust managed by a trustee you have chosen and empowered. The trustee can be a trusted family member, friend, or professional. A trust provides several benefits that a traditional will cannot.

• Financial Control: You can set the terms for the trustee’s use of the funds. You can specify that the money will be used for education, health care, or living expenses. A trust also gives you control over when your children receive their inheritance. You can set the age at which they receive a portion or all of the assets, like at ages 25 and 30, instead of when they turn 18.
• Avoids a Guardianship of the Estate: Using a trust avoids the time-consuming and expensive process of a court-supervised guardianship. The trustee can manage the funds privately without court oversight, saving time and money.
• Privacy: Unlike a will, which becomes a public record once filed with the court, a trust is a private document. It keeps your financial matters confidential and protects your child’s inheritance from public view.

Providing for Your Child’s Immediate Needs

If you become incapacitated due to illness or injury, a court may need to appoint a legal guardian for you, which can be a slow and expensive process. Unlike married parents, a single parent does not have a spouse to take on these responsibilities automatically. We help our clients create a clear plan that addresses these concerns.

Two essential documents are a Durable Power of Attorney for finances and a Medical Power of Attorney for healthcare decisions. These documents let you name a trusted person to act on your behalf, ensuring your children are provided for and your wishes are known if you can’t act for yourself.

Our Approach to Planning for Single Parents

At Rainey & Rainey, PLLC, Attorneys at Law, we understand your unique responsibilities. We are a compassionate team dedicated to helping single parents in Waco and Georgetown create comprehensive estate plans to protect their children’s futures. Our attorneys focus on Elder Law, which means we work to stay informed on the most current information in this area. We typically use flat fees, so once we understand your needs, you can clearly understand the full cost of the work you need to have done.

Having a clear estate plan is one of the most loving and powerful things you can do for your children. It is about protecting their well-being and ensuring their future is secure. We are here to help you do that. We invite you to contact our offices in Waco and Georgetown. You can reach us at (254) 752-8644 or (512) 598-9005.