Becoming a parent is a tremendous responsibility. One of the most important aspects of this overarching responsibility—even though it is overlooked far too often—is estate planning.
While many people think of estate plans as tools for the wealthy or the elderly, they are just as important for new parents of all socio-economic standings. If you have recently welcomed a new addition, creating an estate plan can help to protect your child’s future if something unexpected happens, not only in the event of death but also in situations that result in serious illness or incapacitation, rendering you temporarily unable to care for your child.
Life happens. Death happens. Preparation is necessary for parents.
The most immediate reason for new parents to create an estate plan is to name a guardian for their child. If both parents become incapacitated or pass away, the court will appoint someone to care for the child. Without a legal guardian named in your estate plan, that decision may not reflect your wishes. Designating a trusted guardian in writing can help to ensure that someone you know and trust will be responsible for your child’s care if you are no longer able to provide it.
An estate plan also allows you to manage how assets are distributed to your child in the event of your premature death. Creating a trust can ensure that money intended for your child’s education, healthcare and/or general support is used responsibly. Trusts can also protect assets from being mishandled or accessed too early. Without these safeguards, assets may go directly to your child when they turn 18, regardless of their maturity or needs at the time.
Unexpected incapacitation is another major reason new parents should act with all deliberate speed in this regard. If you become unable to make decisions due to injury or illness, documents such as a durable power of attorney and healthcare directive will help to ensure that your wishes are honored with regard to your care and the care of your child by extension. A durable power of attorney allows someone you trust to manage your finances, while a healthcare directive communicates your medical wishes.
Even day-to-day parental responsibilities can be impacted if you are not legally prepared. Who will access bank accounts to pay for childcare? Who will make medical decisions for your child? An estate plan answers these questions before a crisis occurs. It provides structure and clarity that help protect your family in uncertain times.
Creating an estate plan early in your parenting journey also means it can grow with your family. As your child ages and your financial situation evolves, your plan can be adjusted to fit changing needs. It is not a one-time task but a foundation for long-term security.
