After having your first child, you begin to think of your future in new ways. You’re now suddenly worrying about creating a college fund for your child and protecting their financial stability for decades. With estate planning, you can ensure that your wealth goes where you desire, and you can create plans for many of life’s unpredictable developments.
At David E. Anderson, PLLC, we offer comprehensive estate planning for new parents, including basic document drafting, care directives, and more. Below, our team offers tips on beginning your estate planning journey.
1. Take a Full Inventory of Your Assets First
Before drafting your will or meeting with an estate planning attorney, we recommend taking inventory of your assets. This will help you gain a better perspective of what you have and what you’ll need to designate to others. People often overlook various assets in their estate, leaving numerous items up for debate when they pass.
Here are examples of the assets that might be in your estate:
- Properties, including the house you currently reside in
- Vehicles
- Boats, motorcycles, etc.
- Antiques, coins, art, and other collectibles
- Family heirlooms
- Investment accounts
- Checking and saving accounts
- Life insurance policies
- All retirement accounts
2. Consider Beneficiaries in Advance
You can designate beneficiaries in numerous documents, including your will, trust, life insurance policy, bank accounts, and more. You want any beneficiary designations to match up. Otherwise, your loved ones will face issues later on. For example, if you name your daughter as the primary recipient of your life insurance policy, you should not designate your son as the primary life insurance recipient in your will.
We recommend listing all of your potential beneficiaries in advance. Consider who you’d like to pass each asset to so you can keep your distributions consistent across all of the documents you’ll form with your attorney.
3. Create the Foundational Documents
Estate planning for new parents begins with creating foundational documents, like a last will and testament. In your will, you will designate an executor who will be in charge of settling your debts and caring for your property prior to distribution. You will also designate beneficiaries for all the assets, wealth, and belongings listed above.
You can name various stipulations in your will, including guardianship designation. By naming guardians, you dictate who you’d like to care for your children if something happens to you while they are still minors.
4. Help Your Loved Ones Avoid Probate With a Trust
Your will is only one foundational document in your estate plan. For proper financial planning for dependents, you must execute wealth protection strategies. A trust can help your loved ones avoid the lengthy, expensive, and public court process of probate, which verifies wills after a person passes.
With trusts, you move your assets into a legal entity with designated heirs. You can create revocable and irrevocable trusts, depending on your preferences. Trusts offer tax advantages for your beneficiaries and better wealth security upon asset distribution.
5. Create a Children’s Safeguard Plan
While you can mention child guardianship preferences in your will, we recommend defining specific preferences in a Children’s Safeguard Plan. This is a vital component of estate planning for new parents as it includes legal documents, instructions, medical authorizations, and emergency identifications for child guardianship instructions.
You can create a Children’s Safeguard Plan to leave detailed instructions on who you do or do not want to care for your children and how you would like them to be raised. The plan can cover everything from legal guardianship forms to guidance on religious beliefs.
6. Designate a Power of Attorney and Create Health Care Directives
A Power of Attorney (POA) helps you preserve your medical wishes while protecting the emotional well-being of the loved ones around you. With a POA, you designate a person to be in charge of your care decisions in case you become incapacitated and can no longer decide for yourself. You can also give your POA information on your wishes in advance, guiding them on how you’d like to be cared for.
You may also create numerous advance directives to ensure that your medical wishes are met in any scenario. For example, you can specify your long-term care and life-saving treatment preferences with a living will.
Work With an Experienced Estate Planning Attorney Today
At David E. Anderson, PLLC, we have ample experience in estate planning for new parents. Think about your asset inventory and beneficiaries, then meet with our team to begin drafting your documents. Contact us today to schedule a consultation with an experienced estate planning lawyer.
It’s never too early to start the process.