Estate planning is important at any stage in your life, but some people believe that it isn’t as important when they have young children. A lot of this has to do with their own age. They assume that they have years to worry about how they will pass their assets on to their children.
But the fact of the matter is that it’s actually very important to do estate planning if you do have young children, perhaps even more so than when they’re older. Here are just a couple of reasons why.
You need to pick a guardian
First and foremost, you must pick a guardian for your child. You need to know that the child will be cared for and that someone you trust will be able to step up and do take the role. This makes things go smoothly if the unexpected occurs. Working with a guardian also allows you to talk to this person in advance, so they know what you expect and what you desire for the future.
You may need to wait to give them assets
A second thing to think about is the fact that you probably don’t want to leave assets to children while they are very young. It’s much better to wait until they’re older, but you need a plan to do that. For instance, many people will simply create a trust, and all of their money will then go into the trust if they pass away. This way, the trustee can use the money to help their child, or the money can be passed to that child at a later date.
If you have not yet done your estate planning as a new parent, consider all the steps you’ll need to take to get started.