Many people have children in their 20s or 30s. At the same time, these individuals may not do their estate planning until their 50s or 60s. They see estate planning as something that needs to happen closer to the end of their life, and they really don’t feel like they’re anywhere near that as that first child is born.
Ideally, they are correct, and they still have many decades to get their plan in place. However, it’s a major risk to have children without having an estate plan. You will be much better off to have one in place, even if you don’t expect to use it for decades or if you don’t have very many assets to pass on to your child. Let’s take a look at how helpful it can be.
You get to pick a guardian
First and foremost, remember that you can choose a guardian for your child. If anything happens to you, you know that someone will be there to care for them on your behalf. Selecting a guardian after the fact can be complicated and may lead to disputes between your family members. But you can do it in advance so that the process goes smoothly.
This gives you peace of mind
Again, you may not think that you will need to do this, but life is unpredictable. You can’t be sure of what the future holds. Having a guardian already selected can give you the peace of mind that comes with knowing your child will always be cared for.
You can put assets into a trust
Finally, if you are thinking about the financial side of things, you may not want to leave assets to a minor heir anyway. Estate planning in advance allows you to set up trusts, and you can have your assets transferred into these trusts upon your passing. The trustee, who may also be the guardian, can then use this money to support the child without actually giving them full control over that wealth.
Creating an estate plan can be complicated, so you need to know what steps to take.