Can I name my minor child as a beneficiary?

You can, but a minor cannot legally receive the funds directly. The money typically falls under court control until the age of majority and is then paid out in a lump sum. A trust avoids this.

What happens to the money before my child turns 18?

Without a trust, it is usually held under court supervision (a guardian of property or government office) until the child reaches the age of majority, with limited flexibility and added cost.

How do I stop my child from getting everything at 18?

Use a trust in your will (or name a trust as beneficiary). A trustee manages the funds and releases capital at ages you choose, while paying for the child's needs in the meantime.

Should I name a minor directly on my life insurance?

It is better to name a trust or an adult trustee for the child's benefit. Insurers generally cannot pay a minor directly, which can trigger court oversight and delay access to the money.

Naming a Minor as a Beneficiary: What You Should Know

It is natural to want to leave money to a child or grandchild, but naming a minor directly as a beneficiary — in a will, on life insurance, or on a registered account — can cause problems. Minors cannot legally hold or manage significant assets, so the money may be frozen under court control and handed over in a lump sum at the age of majority. This article explains the pitfalls and the fixes. It is general information, not legal advice.

What happens if I name a minor as beneficiary directly?

A minor cannot legally receive or manage a meaningful inheritance. If you name a child directly, the funds typically cannot be paid to them and instead fall under court supervision (a court-appointed guardian of property or a government office) until they come of age.

When the child reaches the age of majority — 18 or 19 depending on the jurisdiction — they usually receive the entire amount at once, with no further protection. Few young adults are ready to manage a large sum responsibly.

Why is a lump sum at 18 a problem?

Handing a large inheritance to an 18-year-old removes all the control you might have wanted to exercise. The money can be spent quickly, mismanaged, or exposed to others' influence, with no mechanism to release it gradually.

Most parents and grandparents would prefer to support the child's needs along the way and release capital at more mature ages. That requires structure, not a direct gift.

How does a trust solve this?

A trust — set up in your will, or as the named beneficiary of insurance or an account — puts a trustee in charge of the money for the child's benefit. The trustee can pay for education, health, and living costs, and release the capital at ages you choose.

This keeps the money out of court control, lets it be managed and invested sensibly, and protects the child from receiving too much too soon. It is the standard solution whenever a minor is to benefit.

Avoids court control of the funds until adulthood.
Lets a trustee pay for the child's needs along the way.
Releases capital at ages you choose, not automatically at 18.
Allows you to name a backup trustee for continuity.

Can I name a minor on life insurance or an RRSP?

You can, but the same problem arises: insurers and institutions generally cannot pay a minor directly, so the proceeds may go to a court-supervised arrangement. This delays access and adds cost.

The better approach is to name a trust or an adult trustee for the minor's benefit, or to direct the asset into a testamentary trust through your estate. That way the money is managed responsibly from day one.

What if I want to leave a small gift to a child?

For modest amounts, some jurisdictions allow a limited sum to be paid to a parent or guardian for the child without a formal trust. Thresholds vary, so check what applies where you live.

For anything substantial, use a trust or appoint a trustee. The cost and effort are minor compared with the protection it provides for a child's inheritance.

How does iFinallyWill handle gifts to minors?

iFinallyWill lets you leave gifts to children and set up a testamentary trust with a named trustee and chosen payout ages — so a minor's inheritance is managed responsibly rather than paid out at 18.

It also prompts you to consider naming a trust or trustee rather than the child directly on insurance and accounts. With lifetime updates, you can adjust ages and trustees as the child grows.

Frequently asked questions

Can I name my minor child as a beneficiary?: You can, but a minor cannot legally receive the funds directly. The money typically falls under court control until the age of majority and is then paid out in a lump sum. A trust avoids this.
What happens to the money before my child turns 18?: Without a trust, it is usually held under court supervision (a guardian of property or government office) until the child reaches the age of majority, with limited flexibility and added cost.
How do I stop my child from getting everything at 18?: Use a trust in your will (or name a trust as beneficiary). A trustee manages the funds and releases capital at ages you choose, while paying for the child's needs in the meantime.
Should I name a minor directly on my life insurance?: It is better to name a trust or an adult trustee for the child's benefit. Insurers generally cannot pay a minor directly, which can trigger court oversight and delay access to the money.