ESTATE planning for new parents
Whether you’re headed to the store or out of town, your checklist as a new parent has grown significantly: Car seat? Check. Favorite blanket? Check. Diapers (and more diapers)? Check. Current will? Well…
There are many important items for new parents to think about and remember. Life is hectic when you have little ones, but having an up-to-date estate plan in place is crucial in the event something happens to you and your spouse. Here are several important items to keep in mind as a new (or not so new) parent.
● Do I need a will? The short answer is yes. A will is the best way to establish a testamentary trust to ensure that assets are protected for children’s benefit, yet not directly available until the children are mature enough to handle money. In addition, a will is the only legally recognized place for you to name the person or couple who will be guardian for your children. Without direction from you, a court would need to choose: father’s family? mother’s family? grandparents? Other relatives? friends?
A new mother recently relayed to me what a friend had told her—that a godparent is automatically named guardian of the godchild. Unfortunately, many new parents are under this mistaken impression. Naming that trusted loved one as guardian in your validly executed will is the best way to provide direction for your children’s future care.
● I’ve got a will—am I done? Not yet. The next step is to make sure your life insurance, IRA and pension beneficiary designations are up-to-date. Children are frequently listed as the contingent beneficiaries (“second choice”) after a spouse. However, parents whose will establishes a trust for their children’s benefit should name the testamentary trust—and not the children directly—as beneficiary. This will help ensure that your assets are used and distributed according to the plan outlined in your will, and not held up or distributed prematurely, with unintended consequences.
● Traveling? Need a night (or a week!) away? Leaving your children with family or friends is a welcome break, but it can also be nerve-wracking, especially for new parents. What if my child needs to go to the walk-in clinic? What if daycare or school calls? What if something happens to me while I’m away? Wisconsin has now adopted a law enabling parents to name agents to have custody of their children should something happen to the parents. This is welcome news for parents who travel, who frequently need to leave their children with others, or who might be headed overseas to complete an international adoption.
If you or someone you know has questions or needs assistance with these types of situations, feel free to call upon the experienced attorneys at Hopp Neumann Humke LLP. We are conveniently located in Sheboygan at 2124 Kohler Memorial Drive (one block east of the Aurora Sheboygan Clinic) and can be reached at (920) 457-8400.