Creating an estate plan at any time in your life is sure to bring a few challenges to the forefront. However, once you deal with these head on, you’ll feel better about the future.
When you have young kids, the estate planning process is even more complicated. Not only are you concerned about yourself and your assets, but now you’re moving your family to the top of your priority list.
There are a variety of things you can do to lay a ground floor plan for young kids. Here are a few steps to consider:
- Create a trust: Rather than rely solely on a will to pass assets down to your children, consider the creation of a trust. This allows you to leave your assets behind in a private manner, with no concerns of them going through probate. Also, you can add stipulations to your trust, such as your children should not receive any payout until they reach a specific age.
- Name a guardian: Who would raise your children if you and your spouse passed away before they reach age 18? If you don’t name a guardian, you’re leaving this up to the court. And when you do that, you increase the likelihood of a judge making a decision you wouldn’t agree with. This isn’t a risk you should be willing to take.
- Look into a special needs trust: This doesn’t come into play for every parent creating an estate plan, but it could be something for you to consider if you have a child with special needs. With this type of trust, you eliminate the risk of leaving your child assets that will disqualify them for government benefits. It’s often the best way to provide financial assistance to a child with special needs, even after you’re gone.
Estate planning is difficult enough when you don’t have young kids. If you add one or more into the process, you’re sure to have even more challenges staring you in the face.
Fortunately, when you plan in advance, you can create an estate plan that protects your children now and after your passing. That will give you the peace of mind you’re seeking.