Essential Estate Planning Steps for New Parents

As a new parent, there is much to think about in the midst of all of the excitement, upheaval and changes in your life (not to mention the sleep deprivation). However, it is important to note that making and/or updating an estate plan is an essential step that needs to be taken in order to ensure that your new baby is protected, should anything happen to you or the child’s other parent. Below, we discuss three steps in particular that should be taken as part of this estate plan that are specific to planning for a child’s future:

Life Insurance

Purchasing a life insurance policy helps ensure that if something happens to you, funds are available; not only for your child’s care and education; but also for the child’s day-to-day care, is one of those steps. A number of couples opt for term life insurance policies because that coverage is less expensive than whole life policies and they are only interested in the coverage until the child grows up (as opposed to purchasing insurance to serve as an investment).

A Will

You also want to make sure you have a will in place and that someone you trust is managing funds for your child in case your child inherits those funds before they turn 18. Without a will, the courts can be forced to name a guardian for the funds.

The Importance of Choosing & Naming A Guardian

Naming a guardian for your child is very important. If you fail to do so, there could be a possible custody battle and the courts would essentially be left to make the choice based on what state law dictates. For many parents, it is very important to ensure that their child is cared for by people that they select as opposed to someone a judge selects. Whether you want to create a trust, name a trustee to manage your child‘s inheritance, place conditions on the funds in that inheritance, or whether utilize the Uniform Transfers to Minors Act, which allows you to name a custodian for those funds, whereby they cannot receive them until their 21st birthday, you will want to discuss options with your estate planning attorney.

Choose The Right Estate Planning Attorney

As a parent, there is a lot that you will have to do to protect and provide for your child, but making an estate plan is one of the few straightforward tasks that you can accomplish simply by enlisting the assistance of an experienced Orlando estate planning attorney. To find out more about our dedication to and services in protecting families and their futures through estate planning here in Florida, contact Gierach and Gierach, P.A. today to set up a free consultation.

Resource:

secure.ssa.gov/poms.nsf/lnx/0501120205

fool.com/personal-finance/2020/02/23/as-a-new-parent-i-took-these-3-estate-planning-ste.aspx

https://www.gierachlaw.com/using-life-insurance-to-strategically-plan-your-estate-post-divorce/