Though no one wants to think about dying, setting up a will when we have little ones is one of the best things you can do to secure your children’s future.
As a parent, your primary concern is the well-being and security of your children. While it’s not something we like to think about, preparing for the unexpected by setting up a will is a crucial step in safeguarding their future, especially when they are small.
In this article we delve into the importance of creating a will, the steps involved, and the peace of mind it brings to your family.
Why Setting Up a Will is Crucial for Parents
The thought of not being there for your children is heart-wrenching. However, setting up a will ensures that your wishes for their care and future are respected and executed.
Setting up a will when you have children is more than worrying about assets; it’s about making decisions that affect your children’s upbringing and well-being in your absence.
Choosing a Guardian
One of the most critical aspects of a will for parents is nominating a guardian for their children. Making this decision requires careful consideration, taking into account the guardian’s values, stability, and ability to provide a loving environment.
Consider the potential guardian’s relationship with your children. Your children should feel comfortable and safe with their potential guardian.
Take into account the potential guardian’s ability to provide for your children’s needs, including financial support and emotional support.
Lastly, consider the potential guardian’s values and parenting style, as this will play a significant role in shaping your children’s upbringing.
It is essential to have open communication with the potential guardian and ensure that they are willing and able to take on this responsibility.
Determining Assets
A will allows you to specify how your assets should be distributed, ensuring that your children’s financial needs are met.
Your assets include savings, property, investments, and personal items of sentimental value.
Here are some steps you can follow to how you wish to distribute them:
1. Make a list of your assets: This includes bank accounts, investments, real estate, and personal belongings. It is important to have a comprehensive understanding of what you own.
2. Decide how you want your assets to be distributed: Consider how you want your assets to be divided among your children. You may choose to divide them equally or allocate specific assets to each child.
3. Be as specific as possible. The more specific you can be about what goes to whom or when they should receive it, the better.
We would also like to mention that if you have debt, it falls on your estate. Debts are usually paid off using your assets. Therefore, you should be allocating your energy and resources to paying off debt to ensure your children’s future. Discuss money matters with your partner before you even begin to talk about how to distribute your assets.
Appointing an Executor
An executor is responsible for carrying out the terms of your will. Choose someone trustworthy and organized, who understands your wishes and can handle the responsibilities involved.
The executor carries out the instructions in your will, manages your estate, and distributes your assets to your beneficiaries.
Choose someone you trust to fulfill this role, as they will have significant responsibilities. Make sure to discuss your decision with the person you choose to ensure they are willing and able to take on this responsibility.
Creating a Trust for Your Children
Creating a trust can be a great option for parents with small children who want to ensure that their assets are managed properly for their children’s benefit.
A trust is a legal arrangement where a trustee holds and manages the assets on behalf of the beneficiaries, in this case, your children.
Setting up a trust involves the following steps:
1. Choose a trustee: The trustee is the person or institution responsible for managing the trust. It can be a family member, friend, or professional trustee like a lawyer or financial institution. Choose someone you trust to act in the best interest of your children.
2. Determine the terms of the trust: You need to decide how the assets will be managed and distributed. For example, you can specify that the assets will be used for education, healthcare, or other specific purposes until your children reach a certain age.
3. Create a trust document: To establish a trust, you will need to create a trust document that outlines the terms and conditions of the trust. This document should be prepared by an attorney to ensure it complies with legal requirements.
4. Fund the trust: To make the trust effective, you need to transfer your assets into the trust. This can include bank accounts, investments, real estate, and other valuable possessions.
5. Appoint a guardian: In addition to setting up a trust, it’s crucial to appoint a guardian for your children in case both parents pass away. The guardian will have legal responsibility for your children’s care and upbringing.
Setting up a trust can provide peace of mind knowing that your assets will be managed according to your wishes and that your children will be taken care of financially.
Consult with an attorney who specializes in estate planning to ensure that your trust is set up correctly and meets your specific needs.
How to Set Up a Will
1. DIY Will Kits: For those with straightforward estates, a DIY will kit can be a cost-effective option. However, check that it complies with state laws and covers all necessary aspects.
2. Hiring a Lawyer: For more complex situations, or to ensure that all legal bases are covered, we recommend hiring a lawyer specialized in estate planning. They can provide personalized advice and ensure that your will is legally binding.
3. Online Legal Services**: Websites like LegalZoom and Rocket Lawyer offer a middle ground, providing templates and guidance at a lower cost than traditional lawyers.
Additional Considerations
These are additional recommendations you should consider when drafting or setting up a will for your children.
Regular Updates: Life changes, such as the birth of additional children, divorce, or changes in assets, necessitate updating your will.
Letter of Intent: This is a non-binding document that provides additional guidance and wishes regarding your children’s upbringing.
Legal Requirements: Ensure your will meets all legal requirements in your state to avoid complications.
Conclusion
Setting up a will is a profound act of love and responsibility towards your children. It’s about ensuring that they are cared for and your wishes are honored, no matter what the future holds.
