Minor children

Henry Gornbein: Howard, let’s say there are minor children involved. What steps are taken in that scenario?

Howard Linden: There are two ways to go for minor children. If the money is needed during the minority of the children, normally we open up because the law requires conservatorships for minor individuals. Minors being anyone under the age of 18. If there isn’t a lot of money recovered and if the money might be necessary for the use and benefit of the minor child, a conservatorship is required, which someone is then in charge of to control those funds. Many attorneys do what they called structured settlements. A structured settlement can begin at any time, but in order to avoid the probate court involvement and if money is not required during the minority of the child a structured settlement is like an insurance policy. If a child is getting $100,000 and doesn’t need that money during his or her minority you can use that money to buy and insurance policy that will pay certain moneys starting at the age of 18 over many years, sometimes over many decades that will provide and secure that money for the minor’s future. That’s an excellent way to go. It’s not taxable and it pays money when a child is old enough to be in control of his own money. Most of these structured settlements are for a short window that allows a child to have his college paid for and expenses related to that college. It also provides lump sums when the child turns 25, 30, 35 for those parts of a child’s life that require perhaps the purchase of a home or other expenses that most of us are familiar with at different stages in our life.

Henry Gornbein: Howard, who’s managing the money?

Howard Linden: Normally a custodial parent is appointed or has the priority, usually in a judges mind, of being the conservator. There are no priorities under the statute. If a parent has no familiarity with funds and isn’t comfortable with managing funds, then that parent can appoint somebody else. In my situation, for example, I’ve been appointed on numerous files on the behest of a parent because they feel more comfortable with a little more expertise, a little more experience as to where the money should be invested and this kind of thing. I might add that no matter who is appointed conservator, court approval during the minority of a child is always required, so there are a lot of safe guards for that type situation.