Estate Planning Guide for Families with Kids
One of the most common misconceptions about estate planning is that it’s all about physical or monetary assets—basically, who gets what when you die. This misapprehension leads many to believe that, because they’re not especially affluent, estate planning isn’t anything they need to worry about. This couldn’t be further from the truth. There are many concerns encompassed by the estate planning process, including the important question of guardianship for your kids.
It all boils down to this: If you have kids who are under 18, you want to make sure they are well taken care of, even if both you and your spouse or partner die unexpectedly. The estate planning process offers some accommodations for this, but again, misconceptions abound. We get plenty of questions about what the estate planning process entails for parents with kids, and in this post, we’ll address some of the most common ones.
Common Questions About Estate Planning for Families with Kids
How do I declare the person I wish to become guardian of my child(ren)?
Having a will is foundational for your estate planning, and it’s in this essential document that you can name the person/couple who you’d like to take care of your child(ren) in the event that you and your spouse or co-parent both die at the same time.
What happens if I don’t name a guardian in the will?
Some parents just assume that, if they die without naming a guardian for their children, the kids will simply pass to the closest relatives—grandparents or an aunt and uncle. Without the proper estate planning, though, there’s no way for anyone to know your true wishes, which means the question of guardianship may be cast into probate court. This can be a long and grueling process and it’s not guaranteed to have the outcome you want, so proper estate planning is key.
What factors should I consider when choosing a guardian for my child?
This is largely up to you; the legal requirement is simply that you select someone who is 18 or over. With that said, you’ll probably want to think about the guardian’s physical health, geographic proximity, and means/resources for caring for your child. Of course, it’s highly recommended that you discuss matters with this person and make sure they are on board.
Can I ensure that the appointed guardian receives monetary assets?
It’s common for parents to leave their financial assets to the person they name as guardian, ensuring that the person they choose to care for their kids receives as much monetary support as possible. You can make this important stipulation in your will. It’s also smart to set up your appointed guardian as the beneficiary of your life insurance policy, in the event that both you and your spouse or partner die at the same time.
What role does a Trust play in estate planning?
In addition to a will, it’s generally best to establish a Trust, as well. This is especially important for parents of young children. Essentially, you can place your child’s inheritance in a trust, where you can earmark it for certain uses (like education) or stipulate that they don’t get the money until they reach a certain age. This can help prevent your children from squandering their inheritance. Additionally, a trust can help you keep your assets out of probate court, sparing your beneficiaries any legal headaches.
What other documents should be included in my estate plan?
We would also recommend advanced healthcare directives, which allow you to state your wishes for what you’d like to happen if you become medically incapacitated—e.g., how long would you want to remain on life support? This is an especially important consideration for parents with kids, because it ensures that your wishes are clearly stated, and the people you leave behind don’t have to make any wrenching decisions on your behalf.
Learn More About Estate Planning Basics
These are just a few of the recurring questions we get about the estate planning process as it relates to those with kids; to ask us anything further, or to begin your own estate planning process, connect with Singh Law Firm today.