Becoming a new parent is a joyous occasion filled with excitement and new responsibilities. Amidst the joy of welcoming a new family member, it is crucial for new parents to prioritize estate planning to protect their growing family’s future. Here are some highlights about the importance of estate planning for new parents:
Estate Planning Essentials for New Parents:
Welcoming a new addition to the family is an incredibly special milestone in life amidst the sleepless nights and endless diaper changes, it’s easy for new parents to overlook the importance of estate planning. However, taking proactive steps to plan is essential for ensuring your child’s well-being and protecting your family’s legacy.
Protecting your Child’s Future: One of the most critical aspects of estate planning for new parents is naming a guardian for your child in the event that both parents pass away. Designating a trusted individual to care for your child ensures that their physical, emotional, and financial needs will be met according to your wishes.
Creating a Will: A Will is a legal document that allows you to outline how you want your assets distributed after your death. As new parents, creating a will enables you to designate beneficiaries for your assets, including any inheritance you wish to leave your child. Additionally, a will allows you to appoint a guardian for your children who can take care of them when you die.
Setting up a Trust: trusts are valuable tools that allow you to protect and manage assets for the benefit of your child by establishing a trust, you can specify how and when your child will receive their inheritance, ensuring that they are financially secure and provided for in the long term.
Naming Beneficiaries: review and update beneficiary designations on retirement accounts, and other financial accounts to ensure they reflect your current wishes. Designating your child as a beneficiary ensures that they will receive these assets directly in the event of your passing, or you can name a trust. For example, if you want money held for your child beyond them reaching 18 years old.
Preparing Advance Directives: Advance directives, including a durable power of attorney for finances and healthcare proxy, allow you to appoint individuals to make financial and medical decisions on your behalf if you become incapacitated. Having these documents in place ensures that your wishes are followed, and your family is protected in times of crisis.
Reviewing and Updating Regularly: Life changes quickly, especially with a new addition to the family. Regularly review and update your estate plan to reflect any changes in your family dynamics, financial situation, or estate planning goals.
In conclusion, estate planning is a vital step for new parents to protect their growing family’s future. By taking proactive measures to create a comprehensive estate plan, including naming guardians, creating a will, setting up trusts, naming beneficiaries, preparing advance directives, and regularly renewing and updating your plan, you can ensure that your child is provided for, and your family’s legacy is preserved for generations to come. When you’re ready to discuss preparations for your child’s future, call Kelly, West and Murphy to set up a time to chat with a caring and knowledgeable attorney.
