Testamentary guardians - why you should have one for your children, and who to pick
The thought of not being there to care for your minor children is difficult, and something no one wants to imagine. However, having a well-planned arrangement in place could be one of the most important gifts you leave your family if the unexpected happens.
Nominating a guardian in your Will is a simple and effective step to ensure your children are cared for by someone you trust if both parents pass away.
Why appoint a testamentary guardian?
If one parent passes away, the surviving parent usually remains the legal guardian, unless there are family law orders stating otherwise. However, if both parents pass away, there is no automatic backup guardian for children under 18. In this case, someone with a sufficient interest would need to apply to the Federal Circuit and Family Court of Australia for a parenting order. The Court will then determine who should have parental responsibility, based on the children's best interests.
At an already overwhelming, emotional time, adding a Court application to the mix is likely to add to the distress. It’s also not uncommon to see such applications cause conflict within the family and result in a contested application, which can take time and money to resolve.
Appointing a guardian in your Will can avoid the need for Court involvement. It lets others know of your intentions, can help people feel at peace with the appointment and ultimately minimise the chances of a dispute.
Choosing the right person - things to consider
Bond – Having a pre-existing relationship will assist in providing your children with a much-needed sense of security and comfort.
Capacity – Does the intended guardian have the physical and financial ability to care for young children? Do they have the time (e.g. do they travel regularly for work/work long hours/have existing children)?
Location – Does the intended guardian live nearby, or are they willing to move into the family home, so that you children can stay in the area they are familiar and comfortable in? Are you ok with your children moving to the guardian’s homes?
Values - Do the intended guardian’s values, lifestyle, beliefs, etc align with the way you want your children raised?
Trust - Do you trust the guardian to do right by your children?
Consent - Does the guardian consent to being appointed? While there’s no requirement to get their consent before appointing them in your Will, practically there’s little point in doing so if you’re not confident that they will perform the role if needed. It’s also very useful to discuss your intentions and expectations with the person you intend to appoint as a guardian, and make sure that they are willing and able to take on the responsibility.
Insight – will the intended guardian have enough insight to put the children’s needs ahead of their own prejudices and biases – e.g. will they foster the children’s communication with people on the other side of the family, even if they don’t like them?
Working together - If your intended guardian is not the intended trustee of your children’s inheritance, will the guardian be able to get along with the trustee? They don’t need to be friends, but they do need to be able to work together to act in your children’s best interests.
Should the guardian be the same as the trustee?
People often ask us whether they should appoint the same person to be both guardian and trustee or whether they should appoint different people to each role. There are pros and cons to each scenario and the answer will depend on your situation and the people in question.
The guardian’s role is to make parenting and lifestyle decisions for your children, the trustee (also named in the Will) must look after the children’s inheritance until the children have reached 18 (or any other age stipulated in the Will). If chose different people for these roles, consider whether they are likely to work well together for the children’s benefit. The guardian will likley need to ask the trustee to release funds for the maintenance, benefit and support of the children while in their care, and the trustee should not unreasonably withhold those funds.
Appointing different people as guardian and trustee can provide you with the peace of mind that there will be a check and balance on the use of the funds set aside by for your children and that the one person will not have unlimited access to those funds.
However, some people have complete trust and faith in their chosen guardian/trustee and wish to streamline the process by appointing the one person to manage the inheritance of the children as well as care for them. This can certainly make administration more efficient.
There are lots of different combinations. We can assist by discussing the options with you to help you make the right choice.
Letter of wishes
You may wish to consider putting together a letter of wishes, in which you express your intentions and hopes for your children. This can be used as a road map for your guardian, guiding them in decision-making should the appointment take effect. You can list the schools you would like the children to attend, the frequency of visits they should make to your family or your in-laws, what kind of expenses you would consider should be reasonably made from their inheritance and more. The document is not legally binding; however, it can hold a lot of moral sway with those you’ve entrusted as guardian and trustee.
Changes over time
Who will be the best guardian for your children may also change over time as the needs and circumstances of the children and guardian change (e.g. children get older, guardian relocates, someone has increased medical needs, etc).
It is important to regularly review your Will and choice of guardian to make sure your appointed person is still the most appropriate to look after your children.
How we can help
Our experienced team of succession lawyers can assist you in planning for your children’s care should you not be here to do so, providing you with peace of mind that you have a detailed plan in place for the future of your children. Contact us today on (03) 9318 4188 or book an appointment to speak with us about your circumstances.