While nesting for a new baby, first-time parents look for the equipment that will keep their babies safe: the highest-rated car seat, crib and stroller. They babyproof the house, putting little plastic covers in all the electrical outlets. They create layers of protection for the child’s well-being, considering not only the new baby’s physical needs, but their emotional needs as well.
I’ve always seen estate planning as part of this nesting process. It’s a way that new parents build another layer of protection for a child, ensuring the child’s safety and emotional and physical health.
So, how do you determine if your estate plan has all the bells and whistles of the safest car seat on the market? Here’s what new parents should be looking for when they make an estate plan:
- Does it include your specific preferences in your list of guardian choices? One of the hard lessons of being an estate planning attorney is that people do not die in the expected order or in the order they’re born. That means you can choose a couple as your first choice for guardian–perhaps one spouse’s sister and her husband–but if the sister dies, her husband might then be top of the list for guardians for your children. It’s important to be clear about these preferences, so you are expressing the exact order you’d like family members considered as permanent guardians if something happens to you.
- Does it include both temporary and permanent guardianship documents? Every attorney considers guardianship in an estate plan, but not all accommodate short-term guardianship, which may turn out to be more important. Depending on your age and other factors, you’re far more likely to be incapacitated than to die in an accident. During the time you are unavailable, there’s the possibility that without nominating temporary guardians, your children could end up with social services while the court makes a decision. This would be unfortunate considering how many people love your children and would like to show up for them and care for them. A solid plan will include a long list of temporary guardians, so your child is always in the loving hands of a person who knows them (and you).
- Does it include emergency healthcare documents for the child? Healthcare power of attorney, living will, and HIPAA authorization forms all qualify as both estate planning and healthcare documents, and they are powerful and important documents for anyone who believes in having control over their own medical care. You can also create these documents for your minor children, which gives you authority over choosing a healthcare power of attorney to make medical decisions for your child if you cannot make them yourself. In a scenario where you are incapacitated and your child’s medical care requires a prompt decision, this document gives the deciding power to a person you trust, and the decision can be made more quickly.
- Does it include access to emergency documents from anywhere? Estate planning attorneys always think about the worst-case scenario. It’s not always fun, but in an emergency, it means we’re generally prepared. That’s why you have to consider how someone will be able to access your documents anywhere, anytime. Your documents won’t do any good if they live in a safe in your basement. You’ll want to have them available as pdfs on your phone. There are companies that provide this kind of document service, but there are other ways to make sure they are accessible. One of the best ways is to give copies to the key people in your plan and to have conversations with them about your wishes. These conversations are difficult, but they pay off in a difficult situation.
- Have you updated beneficiary designations? With a new baby, you are not only responsible for naming potential guardians and preparing for medical emergencies, you are also fiscally responsible for the care of your child. Updating life insurance policy and account beneficiary designations as well as ownership of bank accounts so they coordinate with your overall planning goals for your children is an important step in ensuring that your estate plan will work with your assets if something happens to you. Often, a lot of work goes into creating trusts for children under a will only to have assets pay outright to kids directly through beneficiary designations. Young people who inherit lump sums of money, such as a life insurance payout that doesn’t go into a trust, often end up spending the money quickly and can actually create more problems: bad spending habits or lack of responsibility. As your child grows and you get to know their personality a bit better, you can update your plan to reflect how and when this money is distributed.
For new parents who are navigating all the changes to daily life with an infant, making an estate plan can seem like a long and difficult process. But it doesn’t have to be so overwhelming. Begin by downloading and filling in the Side by Side Planner with the Supplement for Parents with Young Children. Then, find an experienced attorney in your area and show them the workbook. This will help your attorney craft comprehensive documents and save time and money in the attorney’s office. When you have your plan, keep it in a safe place where it is accessible in an emergency.
I know you want your child to have the safest equipment for a healthy life. The same is true when it comes to an estate plan; your plan can come with the latest in safety features, offering more ways to protect your assets and your loved ones for years to come. Visit www.sidebysideplanner.com for more!