One element of estate planning that is little discussed but can be very useful is the Letter of Intent. Generally contained within an estate plan, a Letter of Intent contains instructions on how the estate and the decedent's executors should care for a child, particularly a child with special needs.
Since for most of us, our children are our foremost priority in life, a Letter of Intent can be a crucial document. And anyone who wants to ensure special care for their children should consider including one with their estate documents; there are no real drawbacks to writing one.
On the other hand, there are limitations to one. There are many things a Letter of Intent cannot do, and any client who issues one should be aware of them. Some of the things to keep in mind:
It's a blueprint for other documents. After putting down specific preferences for the care of the client's child, those wishes can then be reflected in wills or trusts to ensure that they're carried out. After all, the financial decisions should be a reflection of how the client wishes the child to be cared for, and not the other way around.
It can be written today, no matter where you and your child are in life. It's not just that you never know when disaster will strike, although that's always a good reason to be prepared. Understanding a child — especially one with special needs — is a lifelong journey. It makes sense to start the letter now and add to it as the years progress.
Get the child involved. It's the child's life, and he or she deserves to have a voice. And the child will appreciate being allowed to participate in these important decisions about his or her future.
