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damyst:
My wife and I are trying to be responsible adults and prepare a last will. We hope to stick around for another 4-5 decades, but you never know.

The main considerations are guardianship for our 3-year-old son (this part we have figured out), and handling of assets.
Our stash will all go to our son, and it ought to be enough to support him to adulthood and through college, with money to spare.

In a case like this, people often set up a trust with rules for doling out funds, to limit the risk of mismanagement. We spoke with the lawyer who'll be preparing our will, hoping they can give us a formula, or at least best practices for setting up these rules. Instead, all we got was "it's totally up to you." We've never done this before, and hopefully never will again. So I'm asking y'all instead.

My instinct says something like this: come up with a rough estimate of annual expenses that the guardian would incur for raising our son. Pad it generously. Release that amount each year. Add a clause to fund any college related expenses, within reason (we got this idea from the lawyer). Release a lump sum unconditionally at age 20. Release whatever is left at age 30.

Anyone done something like this? What does your plan look like? What do you think of the plan described above?

Perspectives from fellow Canucks would be particularly valuable.

Freedomin5:
Fellow Canuck here.

The problem with your plan is what if there’s an enexpected large but necessary expense during one of those years? Do you expect the guardian to cover anything outside of the typical living expenses?

Our will goes something like this:

If I die, DH gets 60%, and DD gets 40% in trust of the guardian, who is DH.
If DH dies, I get 60%, and DD gets 40% in trust if the guardian, which is me.
If we both die, it all goes to DD, in trust of the guardian, who is my mom and whom we would trust with our lives...or in this case, DD’s life. Honestly, sometimes I think she loves DD more than she loves me, her own daughter. :D

The trustee, who can be different from the guardian, ensures that funds are not mismanaged or misapplied (used for non-DD-related things).

Obviously, you may have to do this again in the future, once your child is grown. How sad would it be if your grown son had to wait for handouts from his 90-year-old named guardian.

Your lawyer shouldn’t have told you “It’s up to you.” Our family lawyer walked us through the whole process, posited different options, and then helped us analyze what would be best in our case. She didn’t tell us what to do, but she did present us with the different common structures/options, and then let us make our own decision.

If you’re in the Toronto area and are interested, feel free to PM me, and I can ask if she wants to take on a new client.

Cranky:
Yes, I think the lawyer should be laying out more options for you.

When we did new wills recently, which were very simple as our kids are grown, the lawyer gave us a million scenarios to try out.

Personally, I'd set it up so that there's a modest annual payout to the guardian (which is the hard decision) until college, and then college costs, and then control of the remainder at 30 or 35.

AMandM:
We are in the middle of making our wills, and we are taking a different tack.  When we are both dead, everything goes to the kids, split equally (per stirpes if you care), with the two oldest as guardians if the youngest are still minors. 

This might not work for all families, but we can trust the guardians to use the money responsibly. Rather than try to predict what their expenses might be and when they might need extra, we are leaving it to them to arrange. Our kids all get along really well and have shared fundamental priorities, so it is reasonable for us to expect they will help each other make good decisions.

damyst:
Thank you to those who responded so far. I'm still interested in hearing people's asset disbursement formulae.

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