In the hustle and bustle of caring for young children, estate planning is probably not at the top of your priority list. But all families, especially those with young children, should have a basic estate plan in place. If something unfortunate were to happen, your family would be grateful that you took the time to put a plan together.
Here are five things to keep in mind when you create an estate plan for your family:
1. Choose Guardians for Your Children
As a parent of young ones, the number one reason why you need a will is to name who will take care of your children if you and your partner pass. If you don’t, the court will appoint a guardian. This person is usually a family member, but which person? Instead of leaving it to the courts to decide among family members, make the decision yourself.
Once you narrow down the choices, make sure to ask the potential guardian if he or she would be willing to take on the role. You want this person to be a willing participant!
2. Make Your Wishes Known with a Will and Living Will
A will also outlines exactly how you’d like to distribute your assets. If you don’t put a will in place, the court will decide, and it might not be to your liking.
Another basic estate planning document everyone needs is a living will. This document lets you state your wishes for your end-of-life medical care if you become incapacitated. This covers things like if you are in a coma, pain management, breathing resuscitation, and organ donation. Instead of leaving the responsibility of such a decision to a grieving loved one, specify your wishes now.
3. Appoint Someone to Make Financial and Health Decisions If You Can’t
Estate planning isn’t just thinking about what to do if you kick the bucket. It’s also important to have documents in place that help loved ones know what to do if you become unable to make your decisions yourself. A durable financial power of attorney and medical power of attorney appoints a person to act on your behalf if you become incapacitated. These duties including doing simple things like paying your bills.
4. Get Life Insurance
One important part of protecting your family after you’re gone is to make sure that they will have enough money to pay the bills. If you have dependents, you need life insurance. You’ll want enough to cover any debts and funeral costs. Also consider how much money is needed for a transition period, living expenses, and future large costs like college.
5. Review and Update Your Estate Plan over Time
Just as your family changes over time, so should your estate plan. You might expand your family, get divorced, get married, or a guardian or executor might pass away. Check-in on your will once a year to make sure it still reflects your wishes.