When you have a child with special needs, estate planning requires special consideration. You'll need…
It’s unlikely that young parents think about dying, becoming seriously ill, or being injured. As unlikely as such a serious event is when we are young, the possibility is always there. This is why we pay for medical insurance, disability insurance, and life insurance.
Even though many young parents acknowledge the possibility of a serious life-altering event by maintaining insurance policies, a much smaller number of young parents have estate plans addressing what should happen if these events occur. An estate plan can be seen as an assurance plan since it provides you with assurance that your wishes will be carried out. These wishes include who will care for your minor children and how your assets will be distributed.
Planning for Disability
In the unlikely event you become unable to make or communicate financial and health-care decisions, you will want to have people you trust to make these decisions for you. Most people name their spouse as the person whom they want to make decisions for them. It is a good idea to name at least one back-up person in the unlikely event your spouse is unable to make decisions for you.
To appoint people, referred to as your agents, to make decisions on your behalf, you will create and execute two power-of-attorney documents, one for financial decisions and one for health-care decisions. These documents have slightly different names, depending on where you live, but they are used for the same purpose across the country.
In your health-care power-of-attorney document you can also specify which medical treatments you want or do not want if you are terminally ill. In your financial power-of-attorney document, you can give your agent the ability to manage all your financial matters or just certain matters.
Choosing a Guardian for Minor Children
If you were to die or become seriously ill, your spouse would continue to care for your children. However, if your spouse were also unable to care for your children, then someone else would need to care for them. This someone is referred to as a guardian. If you and your spouse do not name a guardian in your wills, then a judge will decide who will have custody of your children. Most people would rather choose who has custody of their children than let the courts decide.
Give careful thought about who will raise your children if you are unable to. Think about whether your children will still be able to attend the same schools and participate in their usual activities. You may want to make sure your children’s guardian will raise them with the same, or similar, values you have.
Choosing a Conservator for Minor Children
A conservator is someone who manages another person’s finances for them when it would be unwise for them to manage them, such as a minor child or someone with dementia. Some parents choose their children’s guardian to also act as their conservator, some choose a different person.
Same as with a guardian, if a conservator is not selected, a judge will make the decision. You can name a conservator in your will. However, if you want to lay out more definite instructions as to how and when your children inherit your assets, you should consider creating a trust for their benefit.
Wills and Trusts
Having a valid will ensures your wishes concerning distribution of your assets and guardianship of your children are followed after you are gone. In your will you name the person you want to distribute your estate to your creditors and beneficiaries. You can also name a guardian and conservator for your minor children.
Trusts are usually more involved than wills. They allow your estate to bypass the probate process, making the distribution of your assets faster and private. If a person dies with only a will, or no will at all, then their estate must pass through the public court system. Creating a trust also makes it easier to dictate how your assets will be distributed. When creating a thorough estate plan, a trust is an important tool in addition to a will.
Starting the Estate Planning Process
Having an estate plan is important for everyone, especially parents with minor children. Think carefully about who will make decisions for you if you are unable to, who will be the guardian for your minor children, and how you want your assets distributed. It is helpful to view estate planning as an ongoing process rather than a one-time event. You should revisit your estate plan every few years to make sure it is still in line with your wishes. An experienced estate planning attorney can guide you through the estate planning process so that you can rest easy knowing that you have a solid plan in place. Contact us today to start your estate planning process.