She Didn't Know the Backlash of Naming a Minor

Spoiler alert: it cost the family time, stress, and nearly the whole policy.

Let’s talk about one of those things that sounds sweet on paper but can backfire real quick if you don’t have the right guidance: naming a minor as your life insurance beneficiary.

Now before I go any further—no judgment here. If you're a parent, it feels natural to list your child. You’re thinking, "Of course I want the money to go to my baby if something happens to me." I get it. I’m a mama too. But I need you to understand what really happens behind the scenes when that decision is made without a plan.

The Call I’ll Never Forget

I had a client reach out—panicked. Her sister passed away unexpectedly, and left behind a 9-year-old son. She thought she was doing the right thing by listing her child as the sole beneficiary on her $250,000 life insurance policy.

Here’s the issue: insurance companies will not issue a check to a minor child.

So what happens? The money gets tied up in the court system.

A judge has to step in, appoint a guardian over the funds (which may or may not be who the parent would’ve chosen), and those funds get restricted. We’re talking locked up, inaccessible, and monitored until the child turns 18 or 21 depending on the state.

What should’ve been a smooth payout to help with funeral costs, housing, and day-to-day expenses turned into a legal mess that lasted over a year. And to make matters worse? The court fees and legal representation ate up thousands of dollars.

So, What Should You Do Instead?

Here’s where I need you to lean in—because there’s a better way.

If you want your children to be financially protected, list a trust or a trusted adult custodian under the Uniform Transfers to Minors Act (UTMA) as the beneficiary on behalf of your child. That way, the money can be used for their care—without the red tape and legal drama.

Better yet? Talk with a professional (👋🏽 hey, that’s me) who can help you create a solid plan, so your intentions don’t get lost in translation.

Bottom Line: Love Isn't Enough—You Need Strategy

Your intentions won’t matter if the execution fails. You can love your child with your whole heart, but if the payout is stuck in probate court, that love won’t cover the mortgage, daycare, or therapy sessions.

Let this be your wake-up call. If your current policy lists a minor as the beneficiary, it’s time for a check-up.

Like, yesterday.

Because when you know better—you plan smarter.

🔑 Need help making sure your life insurance actually works for your family?Book a strategy session with me today. Let’s make sure your plan matches your love.

Turning uncertainty into clarity—one step at a time! ✨🔑