If you are in the midst of raising children, estate planning may not be high on your never-ending to-do list. However, creating an estate plan isn’t just about money. It’s about stability, protection and peace of mind for you and your children.
Estate planning isn’t something you can put off until you have more time or more assets. It’s a necessity and one of the most important steps you can take to protect and provide for your children even if you’re no longer around.
Preventing stress, confusion and court involvement
Your will is the foundation of your estate plan. For parents, it’s essential because this is where you name who would care for your children if something happened to you.
Without a will, a judge decides who will be your children’s guardian, and that individual may not be the one you would choose. If you and your spouse were to die at the same time, both sets of grandparents may become entangled in a court battle, which would only cause more emotional harm to your children during an already stressful time.
Consider creating a revocable living trust, especially if your children are minors. Leaving your money directly to them can cause problems, as New York state won’t allow them to inherit the assets outright until they reach 18.
A trust lets you decide how and when your children receive money. You can name a trustee who will distribute funds for things like education, health care and living expenses. The full distribution will occur when your children are older and more financially ready.
Your estate plan isn’t just about what will happen if you die. If you’re dealing with illness or some other incapacity, a durable power of attorney can handle financial matters, such as paying bills and managing your bank accounts. This helps keep everyday life running smoothly.
A health care directive allows you to name someone to make medical decisions for you if you are unable to speak for yourself. This document relieves pressure on your loved ones during emergencies and helps ensure that decisions are made in line with your preferences.
Every parent hopes to always be there for their children. An estate plan is about making sure your kids are taken care of, no matter what happens.