Estate Planning Steps to Take When You Have a New Baby
Becoming a new parent results in a whole lot of changes in your life. It also tends to be a life event that encourages young people to finally take their estate planning seriously.
Your child’s future will be greatly affected by the decisions you make now in your estate planning. It is important for you to do what you can to ensure his or her security in a worst-case scenario.
Here are a few examples of some steps to take to protect your new child’s future through estate planning.
- Take out a life insurance policy: Life insurance premiums are affordable, and term policy coverage should last you long enough for your children to reach adulthood. If you have a child with special needs who will need care even after your death, a whole life policy can be beneficial instead of a term life policy.
- Write your will: Your will serves a variety of purposes, including designating who gets which possessions. But most importantly for parents of minor children, the will is where you designate a guardian for your children in the event both parents pass away before the children reach adulthood. This ensures you don’t have loved ones arguing over the decision after your death—you’ll have already made it.
- Establish a trust: If you pass away before your children turn 18, they will be unable to assume direct control of whatever you leave to them. If you want to take more control over who manages those assets until your children are ready to take them, a trust is the way to go. This allows you to name a trustee to manage the money and items you leave behind, and to provide specific instructions for how funds should be disbursed.
- Update beneficiaries: Some of your accounts may have designated beneficiaries. Your primary beneficiary is likely to be your spouse, but you can name children, or even better, a trustee of a trust for your children, to be your secondary beneficiaries.
For more tips about estate planning after you welcome new children to your family, contact an experienced Tampa attorney at BaumannKangas Estate Law.