Odds are, your clients all have their wills drawn up. Providing for loved ones is a crucial part of financial planning, after all. But a vital piece of that puzzle is missing, according to a survey by BMO Harris Private Banking: custody of minor children.
A stunning 63% of survey respondents have not named a guardian for their children, leaving their fates up in the air should both parents die tomorrow. The survey also found that 40% of Canadians with minor children do not have a legal will, the most legally effective way for parents to identify a guardian.
Guardians are legally responsible for the care of a child should something happen to his/her parents, so the decision should not be taken lightly.
When asked who they might consider appointing as guardian, 80% of Canadians with minor children said they had thought about who they would appoint. Their siblings topped the list, with 47% saying they would send their orphans off to live with auntie or uncle.
Another 17% would choose the grandparents, while 16% said great-grandparents or their own aunts or uncles.
The primary consideration in almost all cases (98%) would be the parenting skills of the guardian, while 93% said financial stability was also important.
"It's good to see that Canadian parents with children under the age of 18 are thinking about who they would have take care of their loved ones, but they need to follow through with the next logical step and make it official," said Sara Plant, vice-president and national director wealth planning and trust services, BMO Harris Private Banking. "If something dire were to happen and a guardian has not been appointed, the process can become quite complex."
The holiday season may provide ample opportunity for those who have not yet named a guardian to approach their intended choice.
"Choosing a guardian is a delicate process that requires a considerable amount of thought and preparation, and is not something that should be done hastily or taken lightly," says Plant. "As the holidays approach, now is a good time to sit down with family members or friends and have an open and honest conversation about guardianship."