When you have your first child, estate planning is probably the last thing on your mind. However, the birth of your first child is actually the perfect time to start thinking about estate planning. Now that you have a child, you’ll need to make important decisions about their future.
Why should parents think about estate planning?
Nobody wants to think about it, but it’s possible that you could die before your child reaches adulthood. If you didn’t take care of estate planning beforehand, the state decides what will happen to your child. Before that happens, it’s important to choose a guardian for your child and name that person in your will.
You could also set up a trust fund for your child. Depending on how you set it up, this fund could give them a steady stream of income throughout their adulthood. A trust fund is especially valuable for disabled children who might need medical care for the rest of their lives. Your estate planning attorney could help you choose the right type of tool.
You could also make your child the beneficiary of certain assets like life insurance policies and savings accounts. Your child will immediately inherit these assets after your death if listed on the beneficiary designation form.
When should you start preparing for your child’s future?
Even if your child is still an infant, it’s never too early to start thinking about their future. If you make smart financial decisions now, your child could live a comfortable life for several years or more. An attorney could tell you what you need to do to prepare for the rest of your life and take care of your child after you’re gone.