Having an estate plan is beneficial for all California residents, but if you are also a new parent, creating one may be of particular importance. Many young people put off creating estate plans, either because they feel they do not have enough assets to warrant doing so or because they simply plan to do so later. Having one in place helps you look out for your new child, and it also helps you maintain more control over your own personal affairs.
What are some of the important estate planning steps you may want to take once you become a parent?
1. Revisit your beneficiary designations
Once you have a son or daughter of your own, you may want to consider reviewing the beneficiary designations you made when creating your investment accounts or purchasing your life insurance policies. Minors may not control property, so you may need to create a trust and move your life insurance policy into it to have those assets ultimately transfer to your child.
2. Appoint guardians and trustees
Guardians and trustees help look out for your child once you are no longer around to do so. A trustee might oversee the financial aspects of your estate and make appropriate distributions to your son or daughter. A guardian might assume custodial rights over your child, if necessary.
While taking these steps may help you provide for your child’s ongoing needs in the event of your death, this is not an exhaustive list of all estate planning steps you might want to take after having a child of your own.