Congratulations! It is a girl (or boy). A new child is a blessing and a huge life change for new parents. Being a new parent can be a busy time and an overwhelming one at that.
Establishing an estate plan is likely to be the last thing on the mind of these exhausted parents. However, it is important that one be established to protect the future of the couple’s growing young family.
1. Choosing The Child’s Guardian
The biggest decision new parents need to make following their child’s birth is to decide who will be the child’s guardian. No parent ever really wants to think about what would happen in that situation, but it is an important consideration to make.
After all, no one wants to leave it up to the courts to decide who gets their child, and no one wants to open the doors for a family conflict if more than one relative steps up to the plate.
Therefore, it is of extreme importance that the parents designate in a Will who will take over as guardian for their child or children if both parents are no longer able to do so.
This decision can be a tough one, and it requires the parents to choose someone who would raise their child in the same or similar manner, uphold the same morals and standards and someone who would be able to financially and emotionally support their child.
It is always recommended that the parents speak with the prospective guardian first to ensure that they are comfortable with this choice. It is also recommended that a second choice be made, as well, in the event that the first selection falls through by death or change in life situation.
It is for this reason that a Will needs to be prepared where the parents can designate their primary choice for guardian as well as secondary choice.
They will also need to designate a personal representative or executor who will handle dividing property and paying off any remaining debts of the deceased.
2. Preparing A Power Of Attorney
Another document of importance new parents need to consider is a durable power of attorney. A power of attorney is a document which gives another individual the right to make financial and legal decisions on behalf of the person writing the power of attorney if he or she becomes incapacitated.
Just as no one wants to think about his or her death, considering his or her incapacity is equally as difficult. However, what happens if the parents are involved in a car accident and both end up in a coma, not able to make decisions on their own behalf?
A power of attorney will ensure that someone can step in to continue paying financial obligations, including those that are associated with the child’s care and well-being.
Power of attorneys can be permanent, but they can be temporary as well. For instance, if the parents leave the child in the care of someone for an extended period of time, say, for a second honeymoon.
They can prepare a power of attorney, giving that person who is caring for the child the authority and ability to take care of the child’s medical needs during the specific time period. These forms can be prepared for a set period of time and get be as limited in scope as the parents deem necessary.
3. Considering Formation Of A Trust
Although preparing a trust can be costlier upfront, it can be much more beneficial in the end if it is the goal of the parents to avoid probate and protect their assets for their children.
By creating a trust and ensuring that all assets are funded to the trust, the parents can designate a trustee who will monitor and safeguard their property until their children reach a certain age.
For instance, if it is the wish of the parents that the child not receive his or her inheritance until the age of twenty-five, they can do this in a trust document.
They can also ensure that the money be used for a certain purpose if, for instance, college is important to the parents. An experienced trust attorney can talk with the parents and help them craft the right document for them.
Contact Brian M. Douglas & Associates Today
Please contact our office if you have recently become a parent and need to begin estate planning, or need estate planning services at any stage of life. Call us at 770-933-9009 to schedule a consultation with a Greater Atlanta area estate planning lawyer today.