A lot of people do not start planning their estates until they are middle-aged. By this age, your children are probably grown up and may even live in their own homes. While some people prefer waiting until this time to begin their estate plans, it is a better idea to plan your estate while your kids are young. If you do not do this and something horrible happens to you and your spouse, what will happen to your children? Here are some tips to consider using if you want to plan your estate now, while your kids are young.
The Purpose of Estate Planning at this Stage in Your Life
The first tip is to understand what the purpose of estate planning is while your kids are young. There are several purposes of doing this, and here are the primary ones:
- To protect your children's wellbeing.
- To protect your kids financially.
- To provide a plan for them if you and your spouse die.
Without an estate plan, the court will get to decide on what happens to your kids. Would you rather make these decisions yourself, or let the court decide for you?
You Should Name a Guardian
When creating an estate plan with young kids in your life, the first thing you should do is name a guardian for them. If you both died, who would care for your kids? Do you have a sibling you would choose? Would you prefer that they live with your parents? You should choose the person in your life that you trust the most, and you should have a conversation with that person before creating your estate plan.
You Should Purchase Life Insurance
The next thing you should do is buy a life insurance policy. You can choose whole or term life, but in either case, you should make sure it lasts until your kids are at least old enough to finish college. The purpose of having life insurance is to provide a way to pay for the needs of your kids. The guardian you name could use this money to provide for your children and to pay for their college educations.
You Can Add Other Details
You should talk to an estate planning attorney to find out what else to add to your plan. Your lawyer will give you ideas and tips to help you ensure that it is complete and thorough.