“And no matter what, there’s not one thing in this world or the next that we can do or hope or guess at or wish or pray that can change it or help it one iota,” James Agee wrote in the book A Death in the Family.
“The loss of a spouse can upend a family’s future,” Christopher Bentley, CFP® writes in the Journal of Financial Planning When a client loses a spouse, a planner’s immediate focus is on “triage”, Bentley admits. Short term needs, including securing cash flow and addressing housing need to take priority,, and “long-term goals like college planning can feel like an impossible luxury, a conversation for a distant and unimaginable future.”
And, if the loss occurs when the children are already in college, or perhaps in high school, that can presents a “time-critical crisis scenario”, Bentley cautions.
In working with our estate planning clients at Geyer Law, we discuss this very situation, recognizing a parent’s premature death as one of those things we all “pray will never happen”. Life events that could impact your estate plan, we discuss, include divorce, the birth of a child or grandchild, a change in assets, or — the death of a loved one. In fact, not only has college funding played an important role in estate planning for parents, we have often helped grandparents incorporate college planning into their own estate and tax planning in order to assist their grandchildren.
Among the mechanisms that can be considered in bolstering college planning are:
- Life insurance on the parents, with the proceeds going to a trust established with specific instructions to pay for tuition and other education-related expenses.
- 529 and Uniform Gift to Minors accounts, with a successor owner e named for each account.
- Trusts can be established (either revocable or irrevocable)m, with instructions to the trustee to pay tuition and other education expenses. “Trust can help you make a loved one’s education part of your wealth strategy,” a Wealth Insights article states.
While at Geyer Law we offer no investment or tax advice, instead coordinating with clients’ financial planning and tax advisors, for all clients with children –and very often for grandparents as well — college funding becomes an important aspect of estate planning.
– by Nicole Eckert, Attorney with Geyer Legal Group, PC
