Some people neglect estate planning when they’re young. Say that you’re 30 years old and you and your spouse just had your first child. You know that you need an estate plan eventually, but you assume that you will live into your 70s, so you still have 40+ years to address it.
This is a common mindset, but it’s also a risk. You never know exactly how long you have to make your estate plan. Additionally, because you just had a child, now may be a good time to get that plan in place. You can always update it as your child grows up and the years go by.
Putting your assets into a trust
For one thing, say that you pass away unexpectedly. If your child is still a minor, they probably can’t inherit many assets from you directly. This can make things complicated, but a wise step to take in advance may be putting some of your financial assets into a trust with your child named as the beneficiary. You can set up specific goals or uses for that money, or you can just write the trust so the child has access to it when they turn 18 and become a legal adult.
Identifying a guardian
You also have to consider what would happen to your child after you pass away. Who would take care of them? Who would make important educational decisions or healthcare choices? To address this, you can choose a guardian in advance. You can work closely with this person to ensure they know what you would want them to do and how they should help to raise your child in your absence.
Even if you never need any of these provisions, knowing that they’re in place can give you peace of mind as a new parent. Carefully consider all of the necessary legal steps.