Question: My spouse and I completed our estate planning with an attorney. In our planning, we left our legacy to our adult children. Should they have their own estate planning?

Answer: Yes, they should have their own estate planning documents for several reasons.

Each adult child should have their estate planning documents to dictate the disposition of their estates. Whatever they inherit from you will become part of their estate and will pass according to their estate planning documents when they pass away (unless you were to use a Descendant’s Trust, discussed in further detail below). How one’s property passes at death depends on how the property is titled: anything that is jointly owned (e.g. bank accounts) will automatically pass to the surviving joint owner, anything that has a designated beneficiary (e.g. retirement accounts, life insurance, etc.) will automatically go to the beneficiary, and anything held in trust will be distributed according to the terms of the trust; whereas anything titled in one’s sole name will pass according to the terms of one’s will. If one of your children died without a will (and they didn’t have a trust or designated beneficiaries) their property would pass according to New York’s intestacy statute. In order to control how their property passes at their deaths (including whatever they inherit from you), they should have their own estate planning documents.

As previously discussed, your children’s estate planning documents will govern how their property will pass at their deaths, which also applies to any property they inherit from you outright. Instead, you may want to consider using a Descendant’s Trust. Each of your children’s inheritance would be held in trust, entitling them to income and/or principal (depending on how the trust is worded), and you would be able to designate the ultimate beneficiaries (such as their children/your grandchildren) when your children pass to ensure your property remains in your bloodline and doesn’t go to your child’s spouse when your child passes away. Other advantages of the Descendant’s Trust include the fact that any property in the trust would be protected from your children’s creditors and would not be subject to equitable distribution if they were to get divorced (provided they don’t commingle their inheritance with their joint marital property). Moreover, if you are concerned about a child’s spending habits, with a Descendant’s Trust you could appoint someone else to act as trustee (or co-trustee) to manage the property for your child’s benefit.