Why It’s Crucial for Parents to Complete Their Estate Planning

As parents, ensuring the well-being and future of your children is a top priority. If you have minor children, creating an estate plan is one of the most important steps you can take to protect their future. Without an estate plan, important decisions, like who will care for your children, may be left in the hands of the courts.

While estate planning often involves asset distribution and minimizing the impact of probate, its most critical component for parents is naming a guardian for minor children. A last will and testament is the legal tool that allows parents to designate who will care for their children in the event that both parents die or become incapacitated.

Without a will, the court will choose a guardian for your children, potentially someone you wouldn’t have selected. Many parents would prefer to make this decision themselves, choosing a trusted individual who understands their values and is equipped to provide the care and stability their children need. For example, if parents name their own parents as guardians, they should carefully consider whether those individuals are equipped to care for children as they age, especially when dealing with teenagers.

Parents also have the option of selecting a non-family member to serve as a guardian. While this may be met with resistance from relatives, it’s important to remember that parents know their children best. In some cases, a close friend who is willing to take on the responsibility may be a better fit than grandparents, especially if they are aging and may not be able to provide the support needed as the children grow older.

Another crucial part of estate planning for anyone over the age of 18 is setting up a Power of Attorney (POA). This legal document allows someone you trust to take over important matters in your life, like managing finances and caring for your home, should you become incapacitated. Without a POA, a family member may need to go through a court process to gain guardianship or conservatorship. In some cases, the judge might appoint a professional guardian who has no knowledge of your family or select a relative with whom you may have a strained relationship.

When creating a POA, it’s vital to work with an estate planning attorney to ensure the document meets your unique needs. Using a generic online document can lead to unintended consequences, such as granting someone more authority than you’re comfortable with.

Estate planning also involves planning for your children's financial needs. If you have life insurance, it’s important to consider what will happen to the proceeds if you pass away. If your child is named as the beneficiary, a court-appointed custodian may be chosen to manage the funds. However, by placing the life insurance funds in a trust and naming a trustee, you can ensure the money is used solely for your child’s upbringing, giving you more control over their financial future.

These are just a few of the important decisions parents need to make when creating an estate plan for their young children. To ensure that your family is protected and your wishes are carried out, it’s essential to consult with an experienced estate planning attorney. Once your plan is in place, you’ll have the peace of mind to focus on the joys and challenges of parenting.

At The Werner Law Firm, we understand the importance of securing your children’s future. Our skilled estate planning attorneys guide parents through the process of naming guardians, setting up trusts, and ensuring that your financial and healthcare decisions are aligned with your wishes. With the right estate plan in place, you can rest assured that your children’s needs will be met, no matter what the future holds.

If you have any questions, schedule a free appointment with us through our online appointment page.

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Reference: Colorado Parent (December 2024) “Estate Planning Series: For Parents”