For young parents, protecting their children’s well-being and securing their future, even when life takes unexpected turns, is in their every thought. Yet, statistics reveal that about 68% of Americans do not have a valid will or any estate plan.
While estate planning might not be the first thing on your mind amid the daily responsibilities of parenthood, it is a crucial step in protecting your children’s future no matter what happens. Here is a guide to the fundamentals as you embark on your estate planning journey.
Write your will
Drafting a will is the most crucial part of estate planning. This document outlines how you want to distribute your assets and who should care for your minor children if something happens to you and your spouse. Without a will, the state decides on these matters, and the outcome may not reflect your desires. Having a valid will is equivalent to taking the reins and ensuring you continue guiding your children well into the future.
Establish a trust
Setting up a trust is one of the most effective ways to manage and protect your children’s inheritance. It allows you to set aside funds for your children and specify how and when they will receive their inheritance, protecting the funds until they are mature enough to handle it properly.
Designate guardians for your children
Sometimes, being a parent means taking the necessary steps to ensure a bright future for your children, even when you are no longer around. This also means designating a guardian who will take over parental responsibilities if something happens to you and your spouse. This decision is one of the most critical aspects of estate planning. It requires careful thought, as the guardian should share your values and be capable of providing a loving and stable environment.
Many young people mistakenly think they can delay estate planning, considering it a problem for another day. However, by planning ahead, you can provide yourself and your family with peace of mind and ensure that your finances will remain aligned no matter what challenges life throws your way.