‘Kidpreneurs’ — Getting a Head Start on Estate Planning

Published on 29 August 2022, 07:22:56 AM

The owner of Hannah’s Summer Treats made $65 her first day and $50 on day two. After expenses, she had yet to break even, but she’s got lots of time to catch up. She was five in 2019.

Entrepreneurship Starts Early

Kidpreneurs are popping up all over North America, thanks to business incubators like Hannah’s dad. He’s a Sault Ste. Marie winner of the 2017 Startup Canada Entrepreneur Promotion Award. Hannah has a Facebook page, T-shirt with company logo, colourful banner and pair of folding camp chairs. She keeps her cost of goods sold low. Some frozen lemonade, ice cream bars and Mr. Freeze sticks are all it takes.

Supportive Parents Make a Difference

It helps that dad has a MBA. As he points out: “As parents we can encourage our children to explore and leverage opportunities to make their own money….” CanadianFamily.net agrees. Supportive parents who nurture and encourage children create future entrepreneurs. When Hannah’s dad helped her set up a lemonade stand, he taught her optimism, self confidence and the value of money.

Kid Companies Are Tailored to Their Strengths

“Entrepreneurs don’t fit into a mold, which makes starting a business feasible for most children, including those with special needs,” says CanadianFamily.net author Melody McKinnon. “For example, many kids with ADHD are especially successful with their own business because they can choose one that allows them the freedom they need.” 

Kids Make Great Entrepreneurs

Hannah’s story is inspiring enough. Programs like The Summer Company and grants and subsidies to hire or train students make bigger dreams come true. They recognize entrepreneurship is the backbone of Ontario communities. 

From Lemonade to Deal Maker

Fast forward 10 years. Fifteen-year-old Texas native Mikaila Ulmer distributes her Me & the Bees bottled lemonade through Whole Foods Market. She cut an $11 million distribution deal at nine. Her inspiration? Being stung by a bee at four. The recipe is her granny’s, using honey instead of sugar.

Sisters on a Mission Where Anything is Possible

Ontario sisters Fatima and Amna Sultan have made $10,000 since starting Two Sisters on a Mission nine months ago. They won a $20,000 deal and free university tuition pitching their plan to Dragon’s Den. Canada’s youngest social entrepreneurs, eight and 10, wrote Anything is Possible. They sell art by Canadian First Nations designer Jason Fobister and Cuban and Thai artists to fund Library in a Week, building libraries worldwide for other kids.

Kids Bloom When They Grow Together

Six Halifax changemakers under 14 got $40,000 from the Dragon’s in 2013 for their organic herbal salad dressing and teas. Today, Hope Blooms is a 60-kid strong social enterprise that has given over 21,000 pounds of free greens to families in need. The venture helps feed North Halifax’s inner city residents.

Planning Your Estate in Ontario

It’s never too young for kidpreneur millionaires and budding successes to make an estate plan. Succession planning is important at any age. Widgets may be flying off the shelves, but as long as their assets are up in the air, your kids venture is at risk.

Four Estate Must Haves for Kid-owned Ventures

1. Make a will. 

It lets business co-owners decide where their millions go. Say you died suddenly without a will. With no direction on what do with the family enterprise, an Ontario probate court will distribute your financial estate itself. Since kids under 18 can’t inherit money directly, their share may be:

• paid in trust to their surviving parent(s), for amounts under $10,000
• paid into court, where the accountant for the Ontario Superior Court  of Justice will manage and invest it until they are 18
• or paid in trust to a court-appointed guardian of property, not necessarily your spouse or their parent.

Not only does that leave your family guessing, but your spouse or ex-partner may have to go to the Office of the Children’s Lawyer or the trustee to ask for money for unexpected expenses.

2. Name a legal guardian.

Your spouse or the child’s biological or step-parent usually has legal custody after you die. If you are their sole surviving parent, you can appoint anyone else. They have 90 days to apply to the court for permanent custody. Be assured, as long as they are in the best interests of the child. the court will usually follow your wishes. 

3. Make yourself legal guardian of your child’s property.

You may be their parent but you’re not automatically the guardian of your child’s assets. You will need to apply to an Ontario court to be guardian of property. That allows you to care for and manage assets on their behalf.

4. Appoint an alternate guardian of property.

Because your child is an entrepreneur, they probably need ongoing business advice. Appointing a guardian of property, or more than one, protects their financial interests after you are gone. Your appointee can help your child invest their profits and make smart or difficult business decisions. Choose someone your child gets along with. They’ll be their new “business partner” when you pass on. 

Create an Estate Plan By Video Call

You can plan your estate by video call anywhere in Ontario with Axess Law’s wills and estates lawyers. Appointments can be arranged 7 days a week, day or evening. Just call toll free to 1-877-552-9377 or 647-479-0118 in Toronto or use our online booking form. In person appointments are available at our Ottawa, Toronto, Scarborough, Etobicoke, Vaughan, Mississauga Winston Churchill or Mississauga Heartland law offices. 

Click here to learn more about Axess Law’s wills and estates services.