Some people think of estate planning as a task that only older Americans need to complete, but young parents also need to get this done. The estate plan can outline what is going to happen with your children if you and their other parent both pass away. While this isn’t something that’s pleasant to think about, you may feel a lot more secure knowing that you’ve handled it.
There are two primary considerations you have when you’re setting up this plan. The first is deciding who is going to raise the children. The second is setting up a financial plan for them.
The person you want to raise the children should be someone you trust to do what’s right for the children. It’s a good idea to discuss your wishes with them to find out if they can uphold those. Be sure the person is able to keep up with the children and that they will be able to make sound decisions for them. This person is the one who you will name as the guardian of the children.
You can use your estate plan to help provide financially for the children. This is done by passing down assets through your will and establishing trusts. You can also use the payable on death designations on financial accounts to provide them with those assets.
When you’re creating the plan, you need to name a person who will oversee the financial aspects of the arrangement. This person can be the guardian, but you have the option of naming a different person to provide a system of checks and balances to ensure the assets you want to care for the children are used in an appropriate manner.