ESTATE PLANNING FOR YOUNG FAMILIES
Many young families put off estate planning. You’re not expecting to die while your family is young, but even a healthy young adult can be taken suddenly by an accident or an illness. When you have minor children and you are a young family, planning is even more important because others are depending on you. Planning for the possibility of a disability or a death at a young age is being responsible and shows your family how much you care. By failing to plan, your children may end up in the protective custody of the state until the government figures out what to do with your children and who will care for them.
A Good Estate Plan For A Young Family Will Include:
Naming a Personal Representative or Trustee
Depending on whether you put a Will in place or a trust, you will need to choose a person to be responsible for handling your financial affairs, in the event there is a disability or a death. This person will be responsible for locating and paying bills, locating and valuing assets, distributing assets to your beneficiaries, and settling your affairs. The person you choose for this should know you well so they are able to carry out your wishes, be willing to do so, and should be without a doubt trustworthy.
Instructions for Distribution of Assets
In traditional marriages, most married couples want everything to go to their spouse when they die. In the event of the death of both parents, their wish is that the assets will be used to care for the children. If the children are minors then further planning will need to be put in place to appoint someone to manage their inheritance for them. In blended families, parents may wish to allocate their assets differently, enhancing the importance of putting a plan in place.
Naming a Guardian for Minor Children
If something happens to you as a parent of minor children, then the other parent will continue to raise the children, as long as they are deemed fit to do so. But if something happens to both of you, who would raise your children? This can be a very difficult decision for parents to make, but it is a very important one. If you have not named a guardian, the Probate Court will have to appoint someone without knowing your children, your family members or your wishes.
Naming Someone to Manage your Children’s Inheritance
Naming a conservator is different than naming someone to act as a guardian. Unless you include this provision in your estate planning, the court will appoint a conservator to manage the children’s inheritance, both how the money is spent and invested. This will cost money, and the fees will be paid from their inheritance. There is also no way of telling who the judge will appoint, and this could result in a complete stranger taking on this responsibility. Upon your child reaching the age of 18, they will receive their inheritance outright and can spend their inheritance any way they see fit. Most parents prefer their children wait to inherit until they are a bit more mature, so the money isn’t spent carelessly. Establishing a trust for your children’s inheritance allows you to state how the monies are to be spent, and to select someone you know and trust to manage the trust assets for your children.
Putting the Plan in Place
Estate planning will require you to think carefully and thoroughly about your family relationships, and the people you have in your life that you trust. These decisions may be difficult to make. As an experienced Estate Planning Attorney, I can help you through the process, provide you with valuable guidance and make sure your plan will meet your goals.
If finances are tight, as they usually are for young families, start with the most essential legal documents, such as a Will, and Power of Attorney for Healthcare and Property (financial). Then update and upgrade your plan as your financial situation improves. The most important thing is to not put this off. Once your plan is in place, you will find comfort in knowing that your family will be protected if something happens to you.