Many young parents mistakenly believe that estate plans are only for wealthy people with numerous assets. However, this faulty assumption could not be further from the truth.
Parents of young children should consider creating an estate plan that includes these essential elements.
A will that names guardians for your children
Most parents can not bear the thought of their children becoming orphans. However, Maryland parents can have the peace of mind that comes with knowing they can protect their children if the unthinkable happens and circumstances rob their children of both parents.
A will allows parents to name guardians to raise their children. Otherwise, a judge determines the guardians, who may not be the parents’ first choice.
Provisions for children with special needs
Parents should consider establishing a trust to pay for the future needs of any children with special needs. A special needs trust will not interfere with a child’s state or federal benefits, but it can help pay for many things to improve the beneficiary’s quality of life. Parents should also name a trustee who will oversee the trust and reliably use the funds to pay for specific eligible expenses.
A life insurance policy can ensure that your children’s guardians have enough money to raise your children and give them the lifestyle you want them to have. Naming children as the beneficiary of a life insurance policy can also ensure that they have enough money to pay for college or other expenses that will improve their lives long after you are gone.
No parent wants to think about leaving their children, but life is unpredictable and establishing an estate plan that protects your children is something you can control.