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Estate planning while expecting a child is great timing

On Behalf of | Apr 11, 2020 | Estate Planning

This might feel like an especially anxious or busy time, but if you are expecting your first child, you just might look back fondly on these carefree days with a comparatively open calendar.

Whether you are looking forward to parenting, or your child or grandchild expects their first child, this could be the ideal time to think about estate planning. The security and lowered anxieties alone that estate planning often brings could make it a great investment of time and attention.

Update beneficiaries now and from now on

If you are like a lot of people, you may have a vague memory of having written someone’s name in a blank field in a form. It may take a moment to remember where, why and who.

Becoming a parent is the time when it becomes essential to do a little inventory. Where were those beneficiary lines you filled out, and who did you name? All your 401(k) or IRA plans gave you a chance to name a beneficiary, as did any life insurance policies.

The spouse or co-parent are common choices for primary beneficiary and the child is often named as the second. If nothing else, let this exercise be a way to get into the habit of returning to all your legal documents regularly to be sure nothing is out of date.

Who loves thinking about life insurance?

Most people find it somehow boring and disturbing at the same time. But try thinking about your lowered stress levels after you get into a term life insurance plan and understand the meaning of what you did.

If you and the child’s other parent died while the baby is still too young to fend for themself, you will have already arranged for the child’s health insurance, housing, food, clothes and a college education until they are old enough to go it alone. And the child would know you made that choice.

Somehow, this might make the topic of life insurance just a little less boring and a little more pleasant to think about.

A trust is almost surely well within your reach

You do not have to be from one of those rich old families who seem to sponsor serious documentaries on public television. Essentially anybody can, and does, set up a trust.

A trust is much like a will with some extremely attractive bonus features. A will is just a piece of paper until you die, at which point it helps guide those left behind in trying to do what you wanted them to do. A trust is a living, breathing legal entity at the instant you sign it.

Unlike a will, a trust gives you control in life and death, allowing you to set the rules. A trust can have tax advantages and can be kept private in ways that wills cannot.



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