If you have recently become new parents or parents-to-be, the last thing on your mind is probably doing estate planning. After all, you’re young, probably healthy, and all of your energy is focused on that new baby. Why in the world should you worry about preparing an estate plan now – that’s something your parents or your parents’ parents have to deal with, right?
In some ways, estate planning is more vital to a young couple than it is to an older couple. For the first time in your life, you have or soon will have a completely helpless human being who is totally dependent upon you for his or her care. And what happens if something happens to you or your significant other or both?
Financial Responsibility of New Parents or Parents-to-Be
There are the financial aspects to address as new parents or parents-to-be, such as determining and obtaining an appropriate amount of life insurance. And saving for that inevitable college education. That’s something a financial planner can assist you with, and it is equally important. But, estate planning deals with the legal side of providing for your child, such as conservatorship and guardianship. Have you thought about who you would nominate as your child’s guardian if you and your significant other were to pass away? How about as the conservator? And just what is the difference between a guardian and a conservator? Should you nominate the same person as guardian and conservator? As new parents or parents-to-be, do you and your significant other agree on who you nominate for these crucial roles? Great if you do, but many couples don’t agree – so what then? And should you set up “co-guardians” and/or “co-conservators”?
If both sides of the family have suitable persons to act as guardian or conservator, how do you, as new parents, decide who to choose? And how to keep the peace between the sides of the family if both you and your significant other have passed? If the opposite sides of the family do not get along, how can you ensure that both sides of the family have a relationship with your children after you have passed?
New Parents or Parents-to-Be and Setting up a Trust
Should you set up a trust for your children now, or use a “testamentary trust”? In either case, what distribution provisions do you want for your children? If you have a trust, what powers do you want to give the trustee to distribute funds to your children? What if your child develops an addiction problem – how will that affect any distribution of funds to that child? New parents and parents-to-be have many decisions to consider.
While we don’t want to think about what would happen if both parents pass away while children are very young, ignoring that possible scenario is a horrible and possibly catastrophic choice. New parents or parents-to-be must understand that failure to choose is also making a choice, and it is a choice that can result in long-lasting and profound problems for your family and children to deal with at a time that they are grappling with the unexpected loss of you from the family. If you are a new parent or parent-to-be, or if you have adult children who are young parents, the best gift you can give to your family is to have a good estate plan. For more information or a free, no obligation consultation with one of our attorneys, please visit www.kansascityestateplanner.com or call (913) 422-0909. At WM Law, we are Here to Help.