Estate planning steps for new parents

On Behalf of | Jul 18, 2019 | Uncategorized

If a tragic event occurs and you pass away, your child’s well-being should be top of mind.

It’s important to have the wherewithal to make plans for financial security, should you be able to provide that long-term stability.

Below are a few steps to follow to ensure your children are taken care of:

  • Set up “Living Documents”: This step focuses on name a health care provider and enacting a power of attorney. Doing so, ensures that the correct person can access your funds to care for your child if you pass away.
  • Choose a guardian and trustee: When you pass, and your estate plan moves to your children, they will need two helpers, a guardian to care for them and a trustee who will handle the estate’s funds.  The guardian is legally required to care for you child until they turn 18, but, in certain cases, a trustee will be appointed to oversee the finances until your child is financially responsible (age 30, 40 or beyond.) This decision is up to the parent who creates the estate plan.
  • Obtain proper life insurance: If you end up dying young, you may not have much to leave your children. This is where your life insurance policy would come in handy. It can be difficult to know which policy to purchase. A couple questions to answer when choosing how much life insurance to purchase are:
    • How much your family will really need?
    • How long will you need life insurance? This is where your age can factor in. If you’re older, or young with an unfortunate health situation, consider term life-insurance. If you live past the term, you can always re-new your policy. If you are young and thriving, a lifetime policy would be in your and your family’s best interest.

Lastly, set up a trust or will to rightly name beneficiaries to your assets or property. An experienced estate planning attorney can guide you through the intricacies of this process. Remember, a minor cannot own property, thus, if you assigned property to a minor, a court could appoint an attorney, or another adult to oversee the account until that child turns 18.