Different people approach estate planning with different goals. For parents, the top priority is usually the protection of their children. Parents want to ensure that their children have the resources and support necessary to thrive after losing their parents.
While most parents get to enjoy watching their children mature into adulthood, some people do not enjoy that privilege. Car crashes, cancer and a host of other unexpected challenges can leave children without the love and support of their parents. An estate plan helps ensure that children aren’t left at the mercy of the state after losing their parents.
How can those with young children protect them more effectively by establishing an estate plan?
Designating a guardian
One of the most important estate planning moves people can make involves choosing someone to take over parental responsibilities after a tragedy. Guardians assume the day-to-day responsibilities that parents typically fulfill. They manage a child’s resources, provide them with housing and generally seek to ensure their well-being and happiness. Parents may need to consider their close family members and friends carefully and then have uncomfortable discussions with certain people to select the right guardian to care for their children in the worst-case scenario.
Preserving resources for the future
An estate plan typically needs to include beneficiary designations so that children inherit the property that belonged to their parents. Frequently, parents with small children may choose to establish trusts. A trust helps preserve resources by preventing guardians from having direct control over a child’s inheritance. Those who carefully plan and fund trusts can help ensure their children have support throughout their childhood and possibly even after they reach adulthood.
Planning for incapacity
Estate planning can also protect children in scenarios where parents have medical emergencies that render them incapacitated but do not result in their death. Advance directives can help families provide the exact medical support someone wants without any conflict about that decision. Powers of attorney can authorize trusted individuals to handle financial and medical matters on behalf of a parent so that the other parent can focus on the children.
Parents who consider how their children might be affected in the event of a parent’s premature death, or in the event of their incapacitation, can plan for the protection of their loved ones. Establishing a thorough estate plan can help parents feel confident that their children will have access to appropriate support regardless of what the future holds.