If you want to name a minor as a beneficiary of your will, life insurance or retirement account, provide for a trustee to receive the money for that child’s benefit. A minor lacks the legal capacity to sign a binding release, so theoretically that minor could receive the money, spend it all and then sue the executor for being stupid enough to have handed it over in the first place.
If you name a minor as a direct beneficiary, a guardian of that minor’s estate will probably have to be appointed to receive the money. Not only will the guardianship be expensive, but also the child will receive every penny at age 18 – an age that seldom carries sufficient maturity to handle significant sums of money. Amounts under $100,000 may be paid into the court registry and deposited by the clerk into an interest-bearing account, but again the minor receives it all at age 18. In your will you can provide for the appointment of a trustee to receive the property that would otherwise pass to an underage or incapacitated beneficiary. Your life insurance policy should then be changed to name that trustee to receive the funds on behalf of the beneficiary.