Many people are facing the idea of their mortality these days due to current circumstances. This may prompt many young people to start thinking about estate planning at a much earlier age than in the past.
This is especially something new parents are thinking about. Having a child makes you responsible for another human being, which means you have to plan ahead for what could potentially happen in the future and the care of your child.
As a first-time parent, Financial Advisor explains you will need to think about a range of important points as you craft your estate plan.
Care of the child
The main reason many young parents create an estate plan is to outline what will happen with their children if they were both to die. You will need to choose a guardian who will be able and willing to take on the raising of your child.
There are many considerations you need to make when deciding on a caregiver. You will need to ensure the person is also ok with taking on this responsibility. He or she should be trustworthy and financially able to provide for your child. Above all, the person should love your child and give him or her a good home.
You will also need to consider your assets. It is often a good idea to create a trust for the care of your child that includes your assets. You can create the trust in any way you want.
You will need to think about the age at which you want to release the trust assets to your child, or if you want to leave the trust in the control of the guardian to use for raising your child.
Estate planning as a new parent make you confront something you probably do not want to talk about but doing it will ensure a stable future for your child.