Estate planning isn’t just for grandparents or people who are near retirement age. In many cases, it’s something that should be addressed by new parents. When a couple has their first child, it may be time to write a will.
Of course, many people actually put this off. They may feel that they don’t need to make an estate plan until they’re older and they have more financial assets, for example. But below are two reasons why it’s a good idea to think about estate planning early, especially with a focus on the children.
A minor may not be able to inherit
To begin with, in many cases, a child’s age can prevent them from inheriting certain assets. For instance, you could name them as the beneficiary of a payable-on-death (POD) account. But because they aren’t 18, they can’t actually control that account, so they won’t have access to their own inheritance.
You can address this by making an estate plan—perhaps by shifting those assets into a trust. The trustee can then access the account and use the money to help the beneficiary, even while they’re a minor.
Choosing a guardian
The second thing to consider is choosing a guardian for the child. If you pass away unexpectedly, you can help your child have more security and stability if you’ve already chosen a guardian to take over your role. It also gives you time to consider things like shared values, age and health, the relationship with the child, similar parenting techniques and other qualities that you would want in the ideal guardian.
If you’ve recently had a child and are now thinking about estate planning, take the time to carefully consider all of the legal options you have to make the right plan for your family.
