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Why every parent really needs to have an estate plan in place

On Behalf of | Sep 20, 2019 | Estate Planning & Probate |

When you find out you’re expecting a kid, unsolicited baby supplies and advice start coming at you from every direction. People seem to have an opinion about what food you feed your baby, what kind of diapers you use and what kinds of toys you let your kid play with.

Fewer people are going to give you practical advice about very serious legal and financial concerns that every parent should consider. For example, finding out that you are about to become a parent means that you need to create an estate plan or at least a last will if you have not already done so. If you don’t take action now, you could potentially leave your child in a vulnerable position in the future.

A last will allows you to name a guardian for your child

Most people want to believe that even if something happens to them, the other parent of their child will be able to take over parental responsibilities and provide a beautiful life for the child they created together. Unfortunately, tragedy doesn’t necessarily care what you want in life. You could wind up in a crash while on date night with your spouse, or you could both contract the same virus.

While it is almost unthinkable to consider, you have to address the possibility that your child could be left without a parent. In that situation, you need to name a guardian or risk the state assuming authority over your child.

Even if you have family members who might step up for the child, if they aren’t approved foster parents and there isn’t a will in place, the state may put your children into a facility instead of placing them with the people you love and trust. Creating a last will sooner rather than later will reduce the risk of your child not having the support and love they need.

Consider structuring what you leave for your kids to prevent financial abuse

In a worst case scenario where both you and your spouse die or can no longer care for the kids, they will be the primary recipients of your assets. Unfortunately, even people you love and trust might covet those assets more than they care for your children.

Caregivers could choose to squander those assets while your child is young, leaving nothing to help them with expenses in the future, such as college or setting themselves up for success as young adults. To prevent unscrupulous people from getting their hands on the assets that you want to leave for your children, you may need to consider creating a trust that you either fund now or that funds at the time of your death.

A trust can help to ensure that the funds you leave behind are only used on certain things for your children or that no one can touch them until your children turn 18. While being a parent should be a source of joy, it also entails important responsibilities to the new life you created. Careful estate planning can guarantee the brightest possible future for your new child, regardless of what unexpected things may happen in life.