Thinking about all the "what-ifs" becomes the norm once you become a parent. What if they fall down and hurt themselves? What if I'm not giving them what they need? What if something happens to me?
Having an estate plan is crucial, especially for parents. Not only will having one ease your mind but if the unthinkable happens, you can ensure your children are cared for in the way that you intend.
First and foremost, in today’s “I’ll just download one” mindset, know that estate planning law is complex and your situation is unique to you. If you misstep, misjudge, or simply don’t completely understand it, your mistakes can not only be expensive but also burden those that you care for the most. So, it's extremely important to speak with an estate planning attorney.
Having these three basics is a must: A Will, a Power of Attorney, and a Medical Directive.
These documents will allow the distribution of your assets, authorize someone of your choosing to make decisions on your behalf, designate who cares for your children and provide guidance for medical professionals regarding your treatment and care.
Along with those basics, you should review your beneficiary designations on assets such as bank accounts, digital access, individual retirement accounts, life insurance, and annuities. Major life events (divorce, marriage, death, children, or step-children) can change the way you want to distribute your assets and decision making authority.
If you have a minor child, you will also want a medical power of attorney so you can entrust a family member or an associate with the authority to take your minor child to a doctor and to make health-care decisions on their behalf.
If you are young, you may be more concerned about the economic impact of COVID-19 rather than any impact on your mortality. The economic downturn may have affected your net worth and inspired you to adjust your estate plan.
If substantial gifts are part of your plan, let’s develop a strategy that will accomplish the transfer of your assets while also minimizing the tax burden.
In an estate-planning guide there are a number of basic things to consider:
- Irrevocable living trusts - These spell out exactly how assets in a trust will be held and distributed before and after your death.
- Durable powers of attorney - These allow you to designate a person of your choosing to make financial decisions on your behalf when you are unable to do so.
- Health-care surrogates - These can designate a surrogate to make health decisions on your behalf and receive health-care information from your doctors in the event you become incapacitated.
- Living wills - These permit you to designate whether you want life-prolonging treatment should you be in a terminal state.
What should your Will include?
Here are a few basics:
Beneficiaries are people you choose to receive real property or personal property in the form of cash or assets. It’s common to name your spouse, children, friends, charities, or other family members.
Executor is the individual who will carry out what’s written in your Will. You can choose whomever you like, but most people choose a responsible friend or family member. If you don’t name an executor, often this job falls into the hands of an administrator who has to pay for a bond.
Parental guardian: If you are caring for young children, it’s important to name the person(s) you want to raise your children should you pass away. Since this is a major life endeavor for the person or people you name, list a few individuals in case one or two of them are not in a position to take on this role at the time of your death.
If the pandemic is making you fear for your health, or your finances, contact Estate Planning Attorney Chuck Bendig today. The consultation is free and online consults are available.
