Austin, TX estates planning & probate attorney Kyle Robbins talks about estate planning for your minor children. He emphasizes that if a client has a minor child, they need a trust. Designating a minor as the beneficiary of a life insurance policy or a brokerage account is a mistake. Minors are not legally capable of managing large sums of money, and doing so triggers the court system. In that case, a probate judge would have to appoint a guardian to manage the assets, oversee their spending, and ensure the guardian is compensated. The guardian would then be required to provide annual accountings to the court and obtain approval for future expenditures. This process is time-consuming, burdensome, and costly, often running into thousands of dollars.

He explains that all of this can be avoided by setting up a trust for the child, naming the trust as the beneficiary, and selecting a trustee to manage the assets until the child reaches a specified age. Unlike a guardianship, which gives a minor access to every penny at 18, a trust allows the parent or planner to control when and how the child receives the assets. When designing an estate plan, he often structures the trust to provide access at a slightly older age, ensuring better financial protection for the child.