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Chioma Ehiaguina: Making Plans for Your Children for When You’re Gone

A lot of persons are of the erroneous opinion that a large percent of insurance companies do not pay the policy sum, or that they find irrelevant clauses in the contract agreement to wiggle their way out of their responsibility. This assertion is not entirely true.



A friend called me a few months ago, saying she came to the realisation that if anything fatal happened to her, her husband, or in the worst case scenario both of them, they had no plans for their children, both of whom are minors. This triggered the thought: A lot of parents, including those with thriving careers and buoyant sources of income, do not make detailed preparations for their children in the event of any fatality. In this part of the world especially, it is rare that parents make proper arrangements in eventualities of death, because our best bet is, “It is not my portion, God forbid.”

Yes, “It is not your portion,” but it certainly costs nothing to tidy your finances to benefit your dependants. Name a guardian for your children, set up an education, investment, and property trust, write a will, and put other mechanics in place to make sure your children continue to live the life you proposed for them, or at least something close to it, if you are no more.

Of course there are several options available to any person who intends to have a backup plan for their loved ones in their absence, some of which are:

A “valid” will
A will is a legal document, where a person, while alive, states how they wants their assets distributed when they die. The executors to a will and guardians for minors may also be named in the will, so basically a will is not only for the distribution of assets.

There are mainly two types of wills, which are the oral and written will. However, the main focus in this writing is a written will. This will must be valid under the law; that is to say it cannot be legally faulted, therefore the will must be voluntarily made in writing, signed by the maker called the testator (who must be of a sound mind during the process of making and executing the will) and acknowledged by two witnesses. It must properly name beneficiaries and describe properties contained therein.

A recent trend in will making is that the testator makes a video reading out the content of his/her will, the process of signing and acknowledgement of the will by the witnesses, usually in the presence of his/her attorney. The essence of the recording is to bar the idea that the testator was coerced to make the will or any issued that may lead to a contest of the said will in the courts

Any person from the age of 18 can make a will, especially if they have dependants. This normally will help the said dependants know how to carry on in the event of any fatality.

Making a will does not by any chance mean you are wishing death upon yourself. Moreover, it will be more devastating to imagine that in the event of any fatality, your dependants do not know what assets you possess, where whatever documents they need may be found. Some of these assets can be converted by unscrupulous elements who parade themselves as friends, well-wishers or undeserving family members, without bothering that adequate provisions have not been made for your young children’s education, upkeep and well-being.

A frequently asked question by a likely testator is: “Peradventure I acquire more assets, how do I add them to the will? Or where I intend to make some changes to the contents of the earlier will, how will this be done since an already executed will cannot be amended?”

You may completely revoke the former will and go through all the processes to execute another, or you may execute a codicil. A codicil is an amendment to a will; it is similar, but not necessarily identical to a will. It can be used to add or delete any provisions in the will, and also to make substitutions. A codicil is also executed in the same manner a will is, and has the same rules of validity.

Life insurance policy
According to Investopedia, “Life insurance is a contract between an insurer and a policy holder, in which the insurer guarantees payment of a death benefit to the named beneficiaries upon the death of the insured.” The insurer must have paid a premium for any beneficiary to be entitled to the death benefits.

The essence of the life insurance policy is to reduce the financial burden on dependants, who may be parents, children, or a spouse. Life insurance can take care of children’s education and upkeep if well managed, depending on the sum. A life insurance policy can also help guardians take care of minors entrusted to them, without painstakingly using their own personal resources. Life insurance policies are definitely worth considering, even though in this clime there is a subtle distrust amongst the citizens for insurance companies.

A lot of persons are of the erroneous opinion that a large percent of insurance companies do not pay the policy sum, or that they find irrelevant clauses in the contract agreement to wiggle their way out of their responsibility. This assertion is not entirely true. Agreed there are existing insurance companies whose activities sully the good name of the genuine and reliable companies. However, with proper research carried out, one should be able to discern the authentic and most trustworthy companies out there.

Setting up a trust
A trust is a fiduciary responsibility, whereby a third party or trustee hold’s assets on behalf of a beneficiary or several beneficiaries. This simply means a legal arrangement where a person, usually called the trustor or settlor, transfers the management of his/her assets to another entity, called the trustee, for the benefit of some other persons.

There is this misconception that trusts are only set up by the elites and bourgeoisie to protect generations of wealth from being squandered or mismanaged. This is not true. The explanation herein serves as an enlightenment and eye opener on the benefits of a trust especially for minors.

There are several types of trusts, the most important to this discuss would be:

Revocable and Irrevocable Trusts
Revocable trust is also called a “living trust.” This type of trust can be altered or completely revoked during the life time of the trustor, who may name himself as the initial trustee whilst he is alive, and a successor trustee to take over in the event of fatality. Revocable trust automatically becomes an irrevocable trust at the death of the trustor. One of the advantages of a trust is that assets that form part of a trust arrangement are not subject to probate.

An irrevocable trust, on the other hand, is one which cannot be altered, changed, modified or revoked after its creation. The assets therein are transferred to the trustee, and the trustor has no rights whatsoever to them. This means that the said assets no longer belong to the trustor.

An example of the content of a trust is that a property can be placed in a trust arrangement where the trustee is mandated to use proceeds of rent, lease or an outright sale of a property to cover tuition cost and medical expenses for minors. The trustee may also be mandated to hold a certain asset in trust and legally transfer same back to a minor, when they attain a certain age.

The trustee is under a strict obligation to rigidly abide by the directive of the trust agreement. The wishes of the trustor must be adhered to, to the latter. Where a trustee violates any of the duties he owes the beneficiaries, then a breach of trust has occurred. The beneficiaries are therefore entitled to legal and equitable remedies under the law.

Trust arrangements are safe, well-articulated, and place the trustees in the same position as the actual parents in respect to financial care. A trustee can also be named as the guardian to the trustor’s minor(s). It would ultimately cost nothing to make adequate plans for children, especially minors in the event of casualties. Parents are hereby encouraged to do so. You can start by talking to a lawyer today.

CHIOMA EHIAGUINA is an innovative young lawyer. She holds a masters degree in Law amongst other qualifications. She is a research enthusiast and a Commercial/ Trade Law aficionado. She can be reached via email at [email protected]

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