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How Much Money Should You Leave Your Children’s Guardians in Your Will

My wife and I finalized our will and estate plan last week, which included naming a guardian for our child and setting aside some money for the guardians to take care of her if we were to pass on. This was the first estate plan we have created together and it was a learning experience…
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My wife and I finalized our will and estate plan last week, which included naming a guardian for our child and setting aside some money for the guardians to take care of her if we were to pass on. This was the first estate plan we have created together and it was a learning experience for us. Less than a week after signing the paperwork, we realized there were a few things we would have done differently, mostly regarding how much we should leave for the care of our children.

The importance of naming guardians for your children

Until last week, our estate plan was sorely lacking. I didn’t have a will, so my estate would transfer by law, which would be to my wife, then daughter, then other heirs (father would be next in line). My wife had a will that was several years old and predated our daughter. So we felt it important to create a new will that would not only specify that our assets would go to the surviving spouse, then to our daughter, but to also name a legal guardian for her. The last thing we wanted was to have something happen to us and have the rest of our families scrambling to determine who would take care of our little girl. It saves heartache, time, and legal bills for everyone involved.

Choosing the guardians. Choosing the legal guardian for your children is a personal matter, and one I won’t delve into in this article. But please put a lot of thought into it before deciding on someone to raise your children in the event you die. You will want to choose someone you trust implicitly and someone that has similar values (religion, ethics, eduction, money, etc.). You will then need to sit down and talk with them about it, ask and answer questions, etc.

Providing for your children after you die

If my wife and I were to both die before our daughter, she would receive the balance of our estate. But that would go into a trust that she wouldn’t be able to touch until she turned 21 or received special permission from a court to use the funds (college tuition, for example). But you shouldn’t stop there.

One section of the will included a provision for the guardians of our child. These funds are designed to help offset the cost of having another child (or children) to the household and can be used to buy a larger car, make an addition to the home, help with incidental costs, etc.

Factors to consider:

  • Guardians housing and vehicle situation
  • Food and clothing
  • Medical expenses
  • Education
  • etc.

How much should you leave for the care of your child(ren)?

The law firm we used recommended leaving at least $20,000 to offset the cost any housing additions or vehicle expenses. So my wife and I looked at each other and said, well if they recommend a minimum of $20,000, how about $50,000?

That was the number we wrote down and left it at that until the night after we signed our wills. Then we discussed that number and some other fun things like how much life insurance we need to buy. (we are currently under-insured, but are shopping for more life insurance – stay tuned for more on that topic).

Now that my wife and I sat down and thought about it a little more, we both feel that $50,000 is woefully inadequate for the long term care of our daughter. Our baby is only a few months old and would require almost 2 decades of guardianship. I can’t help but think the minimum we should have provided would be $100,000, if not more than that.

The topic of estate planning caught us off guard and is something we should have put more thought into. Unfortunately, our paperwork is signed, sealed, and delivered at this point, and redrafting our wills will probably cost a little extra (legal fees for drafting the new will, witnesses, notary public, etc.).

Our plan is to discuss this with our daughter’s chosen guardians and go from there. We also plan to address this the next time we update our will, such as if we move, have another child, or have another major life event. An estate plan can, and should, be modified to fit your needs as they change.

Do you have anything to add?

This is new ground for my wife and I, and we would love to read your responses if you have other ideas regarding how much to leave for your children’s care, or other related estate plan topics.


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About Ryan Guina

Ryan Guina is The Military Wallet's founder. He is a writer, small business owner, and entrepreneur. He served over six years on active duty in the USAF and is a current member of the Illinois Air National Guard.

Ryan started The Military Wallet in 2007 after separating from active duty military service and has been writing about financial, small business, and military benefits topics since then. He also writes about personal finance and investing at Cash Money Life.

Ryan uses Personal Capital to track and manage his finances. Personal Capital is a free software program that allows him to track his net worth, balance his investment portfolio, track his income and expenses, and much more. You can open a free Personal Capital account here.

Featured In: Ryan's writing has been featured in the following publications: Forbes, Military.com, US News & World Report, Yahoo Finance, Reserve & National Guard Magazine (print and online editions), Military Influencer Magazine, Cash Money Life, The Military Guide, USAA, Go Banking Rates, and many other publications.

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  1. Fuzzy says

    I happened upon this blog when doing some research….couple of unsolicited comments:

    We have allotted $1000 a month to be used for an increase in house size for the guardian. Furthermore, the trust owns the children’s share of the home so that it can be borrowed against. The guardian has the option to buy the kids out 7 years after they have moved out or sell the house and give the trust its share of the home.

    The kids have no idea how much money is coming to them but after expenses, all schooling, including college…. they will will get $50k each upon graduation, half of the remainder at 26 and the other half at 31….they do not know any of the above as we want to make sure they have their priorities in order before coming into a large amount of money.

    Lastly, the guardian and back up guardian are fully on board with the entire trust, guardianship, and executor (whom is different than the guardian).

  2. kena says

    I have a question, my children’s father was in an automobile accident and he died. He was a passenger in the car and the insurance company of the person driving said my children are entitled to some money but their was no will, will this money come to help take care of my children now because they are only seven year old twins or do the insurance company automatically put this money in a trust. If they do this what will i have to help support two young children now.

    • Ryan says

      Kena, I’m sorry to hear about your loss. I don’t have an answer for you, but my recommendation is to contact the insurance company to ask them what will happen, and it may also be a good idea to hire a lawyer or attorney. In this case you need an expert who can help you get to the bottom of the situation. Again, I’m sorry to hear about your loss, and I wish the best for you and your children.

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