Estate planning is a difficult conversation for any family to have. With all of the excitement that comes with being a parent of young children, planning what will happen after you pass away isn’t likely to be a top priority. It is, however, a discussion that every family needs to have, especially when the children are young.
Having an estate plan in place is essential for all families to consider. In the event that something unfortunate happens when your children are still young, having a plan in place will ensure that your children will be cared for. From deciding who would be their primary caretaker to making sure they have enough money for necessities: an estate plan puts you in the driver’s seat of the critical decisions for the future of your family.
Nevertheless, as difficult as the conversation is to have, the planning process can also be somewhat confusing for new families. Whether you’re unsure of how to write a will or need help with designating beneficiaries, a lot of thought goes into the estate planning process. Hiring an Orange County estate planning lawyer can help you make the necessary preparations for the future of their children.
Below are all of the necessary steps that are involved in planning your estate and how an Orange County trust attorney can help. If you need help planning your estate, call the Orange County Estate Planning law firm of Masson & Fatini to speak with one of our legal experts today. With over 20 years of experience, we provide estate planning services to protect all of our clients through thoughtful planning.
Write Durable Powers of Attorney and a Living Will
When planning your estate, two of the most critical documents you need to write are a living will and a durable powers of attorney. These two documents not only help in determining health care, they also assist with your finances. If an accident or sudden illness strikes, these documents will make things much easier for your family.
A durable power of attorney is what gives a person trusted authority to make medical decisions on your behalf. Depending on your state of residence, this person is called a health care agent/proxy, attorney-in-fact for health care, health care agent, or surrogate. This document also gives someone authority to your assets, and without it, a court order would be necessary to obtain access to your finances in the event of an emergency.
A living will, on the other hand, is where you declare your wishes for end-of-life care. This document can either be brief or explicitly detailed, but will provide guidance regarding palliative or comfort care. This document is where you can also state whether or not you want to receive CPR under certain conditions.
Decide on a Guardian and Trustee
Another essential aspect when planning your estate is deciding on a guardian for your children, as well as a trustee. In the event that you are not present, your children will need someone who will be able to watch over their ongoing needs. Assigning them a guardian and a trustee will ensure their needs are met.
While being appointed a guardian and trustee is an honor, it can also feel like a burden to some. This is why you and your partner must have a detailed conversation about who your children’s guardian and trustee should be. It’s also vital that you discuss this decision with the person you will be appointing to make sure they accept the responsibility if you are no longer present.
A guardian will not only ensure your children continue to receive a proper education, but will also make sure they maintain an adequate diet and carefully look after their daily needs. However, courts can ultimately decide who should act as the guardian of your children, which means the person you select should be someone who will always put the best interest of your child first. If the court deems this person unworthy of the responsibility, they may overrule your decision if they feel the person you selected is not a good fit.
A trustee, also known as the child’s treasurer, is an individual responsible for the financial decisions in your children’s lives. This person will assume the responsibility of paying for your children’s bills, invests money in your children’s future, and distributes remaining funds to your children when they reach the legal age. Unlike a guardian, courts have limited authority in your choice of trustee, so this decision will ultimately be yours to make.
Additionally, while a guardian will be responsible for your children until they turn 18, a trustee assumes a potentially more extended responsibility. Different from a guardian, a trustee may be required to actually provide for your children until they are financially independent. While it is suitable to give someone both responsibilities, you may want to name a separate individual to act as a co-trustee to ensure everything is looked after properly.
Buy Life Insurance
Next, it’s also essential to address the purchase of a life insurance policy. Life insurance is a great way to ensure that your children will have access to the funds they need to help support the surviving members of the family. If you and your partner are reasonably young and live a healthy and active lifestyle, life insurance is a relatively cheap investment.
Before purchasing a life insurance policy, however, it’s essential to consider a couple of questions. These questions include how much money you think your family will need in the event of your untimely passing and how long do you think they will need it. Answering these two questions can help you better decide on the type of life insurance you should buy, such as term insurance or a lifelong policy.
Designate Beneficiaries for Retirement Accounts
Lastly, to finalize your affairs, a simple step to take is to name a beneficiary of your retirement accounts. This process is relatively simple and only requires you to fill out a beneficiary form that your employer or account custodian can provide, which can be changed later should you decide to do so. By naming a beneficiary, you can ensure that your retirement funds go directly to the person you assigned and can save your family from having to take the matter to probate court proceedings.
Your Children’s Future Starts With You
Ultimately, your estate plan is designed to protect and care for your children when you are no longer able to. At Masson & Fatini, our team of Orange County estate planning attorneys can provide you with a comprehensive approach to the estate planning process and help you make the crucial decisions for the future of your children. To learn more about the estate planning process and speak with one of our Orange County trust lawyers, call us today to get started.