Estate planning is absolutely essential for those who have children
It is commonly known that less than half of Americans have a will. Unfortunately, the desire to avoid thinking about mortality causes some people to put off drafting a will or otherwise plan for their estates. Estate planning should be thought of similarly to having a physical every few years, since, like good health, it will allow you to try to ensure the future financial well-being of the people you care most about.
Estate planning is often a low priority for younger adults who are not married or have no children. However, if you have married and started a family, this could well be the most critical time to begin estate planning in order to protect your family in case you become incapacitated or pass. While adult children can typically care for themselves, young children cannot. If you unexpectedly pass at a young age, your family-and especially your minor children-will most likely suffer financial harm if you have avoided estate planning.
Having an estate plan that will protect your minor children after your death is strongly encouraged. People with minor children should execute a will which includes naming someone to act as the children’s guardian if you unexpectedly pass. A will can also be used to set up a trust to hold the assets you have bequeathed to your children. While the guardian appointed in the will could be named as the trustee for the trust, it is observed that it may be in the children’s best interest to choose different persons for these roles. Out of an abundance of caution, back-ups for the guardian and trustee should also be named.
Unfortunately, some people may have “troubled” children who suffer from alcoholism or substance abuse problems. Some may have spendthrift issues. For these children, sensitive understanding needs to be coupled with good estate planning so that these children can have their lives enriched without an inadvertent enablement of harmful conduct.
A second category of children who can benefit from estate planning are children with special needs who do not have the ability to care for themselves. If a child has special needs, a supplemental needs trust could be set up to help them after you have passed. A trust for children with special needs should be drafted carefully so that the money will not count against Supplemental Security Income and Medicaid benefit thresholds.
Setting up a special needs trust is not a “do-it-yourself” project. An attorney is suggested in order to tailor the trust to the individual circumstances and build in as much flexibility as the law permits. In general, the funds in a special needs trust can be used to pay for anything-including medical benefits-not covered by SSI and Medicaid.
Seek legal help
If you have not taken steps to provide for your loved ones after you pass, you should contact an attorney experienced in handling estate planning. The attorney will be glad to discuss with you a variety of estate planning options.