Estate planning essentials for new parents

On Behalf of | Mar 18, 2022 | estate planning

As a new parent, you have a lot of things on your mind, but one thing you shouldn’t forget is estate planning. Even if you don’t have a lot of money, it’s important to have an estate plan in place.

What is estate planning?

Estate planning is the process of creating a plan for how your assets should get distributed after you die. This includes things like your home, your savings and any other property you own.

Why is it important for new parents?

If something happens to you and you don’t have a plan in place, your assets should get distributed according to state law. This might not be what you want, especially if you have young children who are dependent on you. For instance, if you die without a will, your children might not get anything.

What should you consider?

As a new parent, you need to appoint someone to be in charge of your children’s welfare if something happens to you. In estate planning, that person is called a guardian. You also need to appoint someone to manage your finances if you can’t do it yourself. This person is called a trustee. These two people can be close friends or family members, but it’s important to appoint someone you trust.

You also need to make sure that your will and beneficiary designations are up to date. Things can change quickly after you have a child, so it’s important to make sure that your estate plan reflects your current situation.

Finally, you should think about how much money you’ll need to support your children until they’re adults. This includes things like education and child care costs. You may want to consider setting up a trust to help cover these expenses.

Estate planning may seem like a daunting task, but it’s important to do it for the sake of your children. By taking the time to create a plan, you can ensure that your children get taken care of if something happens to you.