Estate Planning for Families with Minor Children: Why it is Never too Early to Plan

Guidance from a Birmingham, Alabama estate planning law firm.

When you hear "estate planning," you might think it is only for retirees or the wealthy. However, if you are a parent of a minor child, now is the perfect time to start thinking about your family's future. Estate planning is one of the most important steps you can take to protect your children, your assets, and your peace of mind.

What is Estate Planning?

Estate planning is the process of legally documenting your wishes regarding your assets, healthcare, finances, and the care of your children in case of death or incapacity. A comprehensive estate plan allows you to:

• Choose who will care for your minor children

• Determine how your assets will be managed and distributed

• Minimize court involvement, delays, and costs

• Appoint trusted individuals to make decisions on your behalf

• Create a legacy that reflects your values

  
  

Why Estate Planning is Critical for Families with Minor Children in Alabama

Here is a closer look at how estate planning helps protect families—especially in Alabama.

1. Naming a Guardian for Minor Children

This is often the main reason parents begin the estate planning process. If you and the other parent of your children were to pass away unexpectedly, and you had not legally named a guardian, the Alabama probate court would decide who would take custody of your children. The court would not know who you would have chosen and may appoint a relative you would not approve of, or someone outside your family entirely. By legally naming a guardian in your will, you maintain control and ensure your children will be raised by someone you trust.

2. Managing and Distributing Your Assets

Even if you do not consider yourself wealthy, you likely have more assets than you realize: a bank account, car, home, retirement fund, life insurance, or even sentimental items like family heirlooms.

If you do not have an estate plan, your assets will be distributed per Alabama’s default distribution plan. To see who will receive your assets if you do not have an estate plan, click here to see the Alabama statute governing the default distribution plan and here to see our blog article which explains how the distributions will be made.

If you have minor children, they may inherit a portion of your estate. However, because minors cannot legally manage their own inheritance, the probate court will appoint a conservator—unless you have named one in your will. The conservator is responsible for managing the child’s inheritance and must report regularly to the court. The child’s share will typically be held in a separate account until they reach the age of majority, which is 19 in Alabama. At that point, the child will gain full control over their inheritance and will be able to use the funds as they see fit.

Creating a will gives you the ability to specify who will receive your assets, while establishing a testamentary trust or revocable living trust allows you to control not only who receives your assets, but also when and how they are distributed.

3. Avoiding Probate

Probate is a public court-supervised process that can often be costly and time-consuming. If avoiding probate is a priority for you, there are effective strategies available to ensure your assets pass outside of the probate process. These include naming beneficiaries on applicable accounts, holding property in joint ownership with rights of survivorship, and creating and properly funding a trust. Taking these steps can help ensure that your loved ones are able to access funds quickly, and manage necessary expenses, without delays or the need for court involvement.

4. Appointing Decision-Makers for Emergencies

Incapacitating accidents or illnesses do not just happen to older adults. If you are hospitalized and unable to communicate, an individual needs legal authority to handle your affairs.

Essential documents include:

• Durable Power of Attorney – Allows a trusted person to access your bank accounts and manage your financial affairs

• Advance Directive for Health Care – Includes a living will that outlines your wishes for end-of-life care and health care power of attorney (health care proxy) which allows you to appoint individuals to make medical decisions on your behalf.

  
  

Without these documents, your family may need to petition the court for permission to become your guardian and conservator to obtain the right to make financial and medical decisions for you. Guardianship and conservatorship proceedings are expensive, time-consuming, and public. The court retains oversight over the guardian and conservator so long as they are serving, and the guardian and conservator are required to file reports with the court at regular intervals to ensure that they are conducting their duties appropriately.

5. Protecting Life Insurance and Retirement Assets

If you have a 401(k), IRA, or life insurance policy, naming proper beneficiaries is crucial. Many young parents forget to update their designations, or list minor children directly, which can lead to complex legal issues. An estate planning attorney can help ensure that these accounts are coordinated with your overall plan—often through a trust—to protect your children’s inheritance.

6. Minimizing the Potential for Legal Disputes

Without clear and legally binding estate planning documents, your loved ones may find themselves in conflict over who should handle your medical and financial affairs if you become incapacitated. In the event of your passing, there may also be disagreements about who should serve as the guardian of your children. These disputes can lead to expensive, stressful, and time-consuming legal battles. By planning ahead, you can clearly express your wishes and ensure that the individuals you trust are legally empowered to make decisions and care for your children—helping to avoid unnecessary conflict during an already difficult time.

Key Estate Planning Documents Every Family with Minor Children Should Have

Here is a breakdown of the documents that form the foundation of a solid estate plan:

• Last Will and Testament – Distributes assets to the people you want to receive them, in the percentages you want them to receive, and names guardians for minor children.

• Durable Power of Attorney – Authorizes your agents to handle financial matters for you if you become incapacitated.

• Advance Directive for Health Care – Specifies your preferences for medical treatment for your end-of-life care and appoints health care proxies to make medical decisions on your behalf if you become incapacitated.

• HIPAA Authorization – Allows trusted individuals to obtain information about your medical care and your medical records so they can make informed decisions on your behalf.

  
  

If you do not want your children to receive their inheritance outright at the age of 19, then you should also consider working with an estate planning attorney to create one of these documents:

• Testamentary Trust – A trust created by a will that goes into effect only after the person who made the will (the testator) dies. This can be used to manage and protect money for minor children or beneficiaries who may not be ready to handle an inheritance. The testamentary trust controls how and when funds will be distributed. For example, giving a child access to their inheritance at age 25, instead of age 19 (the age of majority in Alabama). It can also set conditions for distributions, such as stating that the beneficiary must graduate from college before they receive their share.

• Revocable Living Trust – A legal document that allows a person (called the grantor or settlor) to place assets into a trust during their lifetime and retain full control over those assets. It is called “revocable” because the grantor can change or cancel the trust at any time while they are alive. A revocable living trust allows the grantor to maintain their privacy because it does not go through the probate process. Additionally, similar to a testamentary trust, it allows the grantor to control how and when their funds will be distributed. A revocable living trust is often used for incapacity planning, because it allows a successor trustee to step-in and obtain control of the trust's assets if the grantor loses capacity.

The Importance of Beneficiary Designations

Beneficiary designations are a key component of comprehensive estate planning. These designations ensure that your life insurance and financial accounts go to the individuals you would like to receive them. Beneficiary designations are controlling and are not subject to the terms of your will, trust, or the probate process, ensuring that the assets that have beneficiary designations will pass directly to your named beneficiaries. For this reason, it is crucial for you to review your beneficiary designations regularly and work with an estate planning attorney to ensure that the beneficiary designations you have made are in alignment with your estate plan.

What Happens if You Do Not Have an Estate Plan in Alabama?

If you pass away without a will in Alabama, your estate is considered “intestate.” That means Alabama law—not you—decides who inherits your assets.

Here is what that might look like:

• Your spouse may not receive everything.

• Your children could receive assets at age 19, with no restrictions or oversight.

• A court may assign a guardian for your children without your input.

• Your family could face delays, legal costs, and potential conflicts.

  
  

How an Estate Planning Attorney Can Help

At Provident Law / Estate Planning LLC, we help families across Alabama and Florida create customized estate plans tailored to their unique needs. While this article focuses on Alabama law, we are also licensed to practice in Florida and can guide you through the estate planning process under Florida law. No matter your situation, we make planning easy, whether you are:

• A new parent

• A young couple buying a home

• Blending families through remarriage

• Starting to build wealth or save for college

  
  

We offer:

• Flat-fee estate planning packages tailored for families

• Virtual and in-person appointments

• Custom strategies to fit your goals and Alabama and Florida’s legal requirements

  
  

Get Started Today—Your Family Deserves the Protection

Estate planning is not about fearing the future—it is about preparing for it. The sooner you take action, the more control and peace of mind you will have.

As you move forward with your estate planning, we invite you to contact our team at Provident Law / Estate Planning LLC. We are committed to making estate planning easy and will guide you through the process, ensuring your plan is tailored to your unique needs and goals. Whether you are creating a will, establishing a trust, planning for incapacity, or reviewing existing documents, we are here to provide the personalized guidance you need. Reach out today to schedule a consultation and take the next step to give your family peace of mind.

About the Author

Colin McMichen is an experienced attorney and the founder of Provident Law / Estate Planning LLC, a Birmingham, Alabama based firm. With a focus on estate planning and probate law, Colin is dedicated to helping individuals and families make estate planning easy.