Estate Planning for Parents
For many parents, the idea of organizing an estate plan is typically low on the priority list, as many operate under the mistaken assumption that their current finances don't justify planning efforts. However, parents should understand that responsible parenting includes a proper estate plan to look after your loved ones in the event of an unforseen happening.
An estate plan for a young family should start with naming an executor (also known as a trustee) to administer the estate. Your executor is responsible for carrying out your directions, as specified in your Will. An executor will locate and identify your assets, pay any outstanding debts, settle any claims against your estate and distribute your assets in accordance with your instructions. It's common (although not necessary) for spouses to name each other as primary executors of each other's estate, however alternate executors should be appointed in the event of something happening to both parents.
An equally important task is naming a guardian to care for your children until they're the age of majority. Your guardian and executor may be the same person if you so choose. Careful consideration should be given to items such as the location of your guardian, and whether or not your children would have to relocate from the family home. Parents should approach prospective guardians for their children prior to naming them in the Will, to ensure that all parties are in agreement on important issues surrounding the future care of the children.
Your executor will need direction on the management of your child's inheritance. Parents can specify the age when their child or children can personally receive their share from your executor (typically between the age of 21 to 30). Executors may also be given instructions to distribute funds to your children, or their guardian, in their earlier years to cover ongoing maintenance, medical, emergency or educational needs.
With proper planning, parents of young children can have peace of mind in knowing that their family will be protected in an unforseen event. Please contact us if you would like some additional information on estate planning.