The birth of your first child can be joyful, breathtaking and nerve-wreaking all at once. New parents in Altoona will take many steps to prepare for their new arrival, but one step they should not overlook now that they have a child is estate planning, both for their future and their child’s future. The following is a brief overview of some documents new parents will want to include in their estate plan.
Name a guardian
Parents may execute a will stating what their child and other heirs will inherit upon their death. However, it is a sad fact that sometimes both of a child’s parents will die before the child is born. To plan for this possibility, parents will want to name a guardian in their will who will care for their child if both parents pass away. It is important to discuss the issue of guardianship with the chosen individual ahead of time, to ensure they are willing to take on this role. In addition, any guardianship decisions should align with the child’s best interests.
Execute powers of attorney
New parents will want to execute a power of attorney for health care and a financial power of attorney to make decisions on their behalf if they become incapacitated. This can also ensure funds are accessible to care for the child.
Execute a will and/or a trust
New parents may think a will is all they need to pass on their assets to their child upon their death, but trusts can also be useful documents. Trusts are managed by a trustee who can pay bills upon your death, file income tax returns, make investments and eventually make distributions from the trust to your child. Unlike guardianship which ends when their child turns 18, a trustee can oversee your child’s financial needs past age 18, per the terms of the trust.
Estate planning is one of the greatest gifts you can give your child
These are only a few documents that make up a comprehensive estate plan; there are other documents to consider not included in this post. Estate planning is one of the greatest gifts you can give your child. However, because estate planning is a legal process that most people in Pennsylvania area are unfamiliar with, it is important to work with an attorney who can help explain your options so you can make informed decisions.