Adults often put off estate planning. Maybe you’re a young, married adult and you simply assume your assets will pass to your spouse. You’re not worried about it, and in many cases you may be right. Then you have a baby. Now you start to think more about having some type of estate plan in place. But what does that look like?
Choosing a guardian
An important part of your estate plan is choosing a guardian for your minor children in case you as parents die before they become adults. Depending on your family dynamics it can be imperative to formally nominate a guardian. Preferably, you have someone in your life that shares your values and is properly situated to care for your child. You need to know that your child has someone else to love and care for them moving forward.
Creating a trust to hold assets
You also want to think about how your assets would transfer to a minor heir. In most circumstances, without a will or a trust your money will go directly to your child when they reach the age of 18. That is not always in the child’s best interest. Instead, you can consider setting up a trust for the benefit of your child. If you pass away, your assets then go into the trust and the trustee can distribute that money as needed for the health, education, and support of your child.
These are just a few important things to consider in your estate plan when you have young children.