Becoming a new parent is a life-changing event that is often marked by joy, excitement and a fair share of new responsibilities. Amid the whirlwind of welcoming a new child, estate planning might not be at the forefront of your mind, but it’s an essential task that is worthy of your consideration.
If you are a new parent, crafting or revising an estate plan is crucial for ensuring the well-being and security of your child if something were to happen to you. Without an estate plan in place, legal disputes could arise concerning who should assume guardianship over your child and how your assets should be managed on their behalf.
Why is this effort so important?
Perhaps the most compelling reason for you to have a current estate plan in place is to designate a guardian for your child. In the unfortunate event that both parents pass away or become incapacitated, a guardian will be responsible for the child’s upbringing. Without an estate plan stating your choice, the court will decide who will raise your child, which might not align with your wishes.
Your loved ones could also end up fighting over who should assume guardianship, which could cause lasting damage to their relationships. An estate plan can even include instructions for your child’s care. This can encompass your wishes regarding their education, religious upbringing, and other personal values you want to be instilled in them so that there is no reason for legal disputes to arise on these grounds either.
Additionally, an estate plan allows you to outline how your assets should be managed and distributed to support your child’s upbringing and education. Setting up trusts can be an effective way to ensure that your child is financially taken care of, with the funds used for their intended purpose, such as education, health care and general welfare. Trust creation will give you control over any aspect of this management process that is important to you, so that your wishes are clear, enforceable and are not subject to dispute.
Knowing that you have a plan in place for your child’s future can provide peace of mind. Estate planning helps to ensure that your child will be cared for according to your wishes and that they will have the necessary support and resources to thrive. Making this effort can also help to ensure that your loved ones remain out of the courtroom, because they’ll have no grounds upon which to challenge your intent.