You may never have really thought about estate planning before in your life. You know that you will need to make a plan at some point, but it’s something you figure you can address later on. It feels like it’s much too early in life to consider taking these steps.
After all, you’re only in your 30s. You just had a new child and you’re focused on starting a family and furthering your career, not planning for how to pass on your assets. But the truth is that becoming a new parent is actually one of the reasons why you may want to consider doing your estate planning now.
It’s more than just assets
The thing to remember about estate planning is that passing your assets on after you die is just part of the process. You may not have to do that part of it for years or even decades. But there are still a lot of ways that an estate plan can help you and your child.
For example, you could set up a system to put your money into a trust if you pass away while your child is still a minor. This protects the money so that they will have it when they grow older, and can also give you the ability to decide how that money should be used – such as paying for college tuition.
Who cares for the child?
Additionally, your estate plan could be used to choose a guardian for your child. If you pass away while they are still a minor, you need a parental figure to step in. By choosing a guardian, you make sure you know that someone is ready to take on that role and that they have the legal ability to make decisions for the child.
When you do choose a guardian, this can also be a good time to set up a trust. It can be designed so that the money helps to cover the costs, making caring for your child much more affordable.
These are just a few of the things you want to consider, but make sure you really understand all of the different options you have with estate planning.