What Young Families Should Know About Estate Planning
Often, young adults are not in a huge hurry to create an estate plan. They don’t dwell on the possibility of illness or incapacity. However, they need to make estate plans for the same reason that older people create them: there is no guarantee of ongoing good health, even for people in their twenties and thirties. Young families should consider making arrangements that address their unique concerns.
Guardians for Minors
If you have young children at home, their care will need to be entrusted to a guardian if their parents should pass away. This is one of the most important aspects of estate planning young families need to consider. Oftentimes, parents decide that custody should pass to grandparents or other relatives, but it’s best to give the matter some thought and come to a final decision together. Sitting down with a New York estate planning attorney to appoint a guardian for minor children is a necessity for young families.
Naming Your Executor
Who would you like to collect your assets, pay your debts, and carry out the wishes set forth in your will? This person should be named the executor of your estate. Most people appoint their spouse, but you will need a contingency plan in the event that they cannot. The person you choose can be the same as the guardian you appointed but doesn’t have to be. Whoever you ultimately choose, this decision will have a considerable impact on the probate and asset distribution process for your estate.
Life Insurance
New parents should consider looking into their insurance needs and buying enough life insurance to cover their rent or mortgage payments, loans, tuition and additional expenses for their families. A comprehensive life insurance policy can provide financial security in a difficult time if a spouse or parent passes away. Young families should find an insurance policy that fits their budget while covering vital expenses.
Distributing Assets
Would you place the proceeds of your life insurance, IRA, and home in the hands of an 18-year-old? With no estate plan in place, your children will be able to access their inheritance when they become legal adults at age 18. For this reason, many parents choose to set up an estate plan that names a trustee to distribute the proceeds of the sale of assets and other property to children until they reach an appointed age. A trustee is the person you decide can be trusted to handle your children’s finances until they come of age; this person typically has discretion to pay for a minor’s education and living expenses from the estate without giving them direct access to the money. In general, trusts for minors are outlined in the will and are known as testamentary minors’ trusts.
Even if you are young and in good health, it’s still a good idea to plan for the future. If you feel that you do not have enough assets to bother with estate planning, there are still steps you can take to protect your family. To learn more about planning your estate at every stage of life, contact the law offices of Queens probate lawyer Richard Cary Spivack.
